Netflix: Push and Pushback in Streaming Video

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Module 3 Case Study Analysis

Netflix: Push and Pushback in Streaming Video

MBA 530


Netflix is a company that dominated the DVD rental market in the past. In more recent years, Netflix has stepped up their game and entered the world of streaming unlimited TV, and movies over the internet to its consumers at home by using their TV’s, PC’s, and gaming consoles. Netflix is available to stream with over 200 devices in the United States. According to the website, Reed Hastings and fellow software executive Marc Randolph co-found Netflix in 1997 to offer online movie rentals. Each year since, they have tried to remain up-to-date with technology and tapping into new markets to stay ahead of their competition.

Case Study Analysis – Netflix: Push and Pushback in Streaming Video
Like most organizations in today’s business world, there are challenges that must be faced. Netflix has transformed their business model from DVD rentals to subscriptions for online streaming. In doing this, they have encountered some challenges. It’s important for the company to keep moving forward and grow their business to stay successful in today’s growing technologically dependent world.
Four Major Challenges Online streaming video appeals to a young audience that is difficult to reach on traditional television owing to their light television viewership and heavy usage of technology to avoid advertising (Kelty, 2011). Because more people are using their mobile devices, gaming systems, and tablets, the first challenge Netflix faces is their ease of access to their streaming service. Being user-friendly is crucial to the success of Netflix. To address this issue Netflix first must ensure their service is accessible to the customers. Consumers have so many choices today of what kind of device they would like to use. Netflix must build relationships with companies like…...

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...Netflix is an American company that provides video rental and on demand video streaming by way of either the mail or streaming through the internet. The company was founded in 1997 in Silicon Valley California by Marc Randolph and Reed Hastings. The idea for this DVD rental service came about when Reed Hastings was charged with a late fee when renting a movie and he questioned why he should have a time restriction on how long he is able to rent the movie. In April of 1998, the Netflix website was launched and they developed the concept of unlimited rentals with no shipping fees or late fees. In September of 2002, an article in The New York Times article stated that Netflix had around almost 670,000 subscribers. At the end of 2002, the company had one million subscribers and in 2006 they had close to 5.6 million subscribers. After these first important milestones, the company’s growth became exponential. In the fall of 2004, a consumer filed a class action law suit against Netflix in Frank Chavez v. Netflix, Inc. The lawsuit was due to claims of false advertising in which the company said they provided “unlimited rentals” within a “one day delivery.” Netflix denied making any mistakes within their advertising. A month later, Netflix decided to give anyone who was a member before January 15, 2005, a membership renewal with one free month included. The final settlement came to around 4 million dollars. This caused a change in the Terms of use which went into effect in January......

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Netflix Case Study influential as Netflix, building a service from the ground up that supports millions of different viewing opportunities for its subscribers in a variety of markets. Netflix however is not immune to rapidly changing marketplace in which it shares strong competitive competition. Multiple companies including; Apple, Amazon, Hulu, RedBox and others bring new options to the table for the consumer and place Netflix in the carious position to continuously rethink and develop its marketing strategies if it wishes to stay on top of the competition. This paper looks at several areas surrounding Netflix current market strategy and how it will likely fair against its competition moving forward. Along with looking at the current market strategy of the company focus will also be paid to Netflix’s past failures and success and the potential for continued success in the future. Keywords: Competition, Competitive Advantage, Marketing Strategy   Netflix Case Study In 1998, Netflix CEO Reed Hasting, along with software executive Marc Randolph officially opened Netflix for business. Hasting and Randolph realized the potential opportunity and perceived growth that the DVD market would have on the US entertainment sector. Further they were able to capitalize on DVD’s smaller size, in comparison to VHS, and developed an approach to deliver the new entertainment media to consumers via rent-by-mail service. While the DVD was becoming rooted in the US market, Netflix was able to build......

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...FACTORS PORTER‟S FIVE FORCES Page 3 Page 3 Page 3 NETFLIX, THE COMPANY PROBLEMS FACEBOOK BLOCKBUSTER Page 6 Page 8 Page 9 Page 10 CONCLUSION Page 11 RECOMMENDATIONS Page 12 EXHIBITS Page 14 APPENDIXES Page 18 1 INTRODUCTION Netflix entered the video rental industry in 1998, being pioneer on the online delivery channel. They were the first conceiving the digital format that was able to faster the delivery process at the same time it abolished several costs related to the physical points of sales. Being pioneers and developing technologies on which they had patents over could initially be seen as a competitive advantage. The fact of being the first ones operating under this format permitted them to come up with several services before competitors, as the streaming video, the disc rental, the original programming and the household profiles. Not only for being pioneers, but also for the valuable services offered, at accessible prices and with high variety of content, the image among consumers about Netflix was constructive. The share of mind among users was on a general perspective positive and of satisfaction relating to the services they were paying for. Netflix had a great brand awareness and in a positive sense. However, more recent happenings are changing this position. With the years competitors of the industry developed their services, competing more and more directly with Netflix. As so, over the years, in order to survive, the......

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