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Reed Hastings: Padre De Netflix

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Reed Hastings: Padre De Netflix

  1. 1. Reed Hastings: ¡Padre de Netflix! Josh Jacobson
  2. 2. The Genesis of Netflix 1997: Reed Hastings forced to pay a $40 late fee for a VHS of Apollo 13 Hastings decided that there could be a market for DVD rentals by mail with no late fees Hastings founded Netflix in 1997, providing a new alternative to movie rental stores
  3. 3. The Subscription Model Netflix started out with a pay-per-rental business model, similar to that of current movie rental stores Netflix had only limited success at first with this business model When Hastings decided to make the risky move to a subscription-based business model Netflix's popularity exploded 1999: Netflix launched an internet-based subscription service, signing up 239,000 subscribers in the first year
  4. 4. Reasons for Hastings' success Netflix's subscription model offers customers unlimited DVD rentals for a relatively low monthly rate Since the vast majority of Netflix subscribers don't watch a lot of movies, Netflix can afford to offer customers unlimited rentals for the same price as 4-5 rentals from Hollywood Video or Blockbuster As a result, even though Netflix's average cost per subscriber is less than 1/4 of the subscription price, Netflix is technically offering customers a service worth far more than the subscription price
  5. 5. Netflix Instant Streaming When Hastings formed Netflix in 1997, he predicted that someday movies would be delivered through the Internet rather than by mail There was a reason why Hastings named the company "Netflix," not something like "DVD's by Mail"  In 2005, Netflix launched Instant Streaming Offers customers unlimited instant streaming at no additional charge Library of over 90,000 titles, a selection with which cable Pay-Per-View can't compete With Xbox and Blu-Ray players, Netflix offers instant streaming (in HD!) directly to your TV
  6. 6. Netflix Instant Streaming, cont. Netflix Instant Streaming also offers past seasons of many popular TV shows In the future, Netflix could conceivably become an alternative to a cable subscription by offering current TV shows on demand
  7. 7. Impact on Society Hastings has effectively abolished the idea of "late fees" in movie rentals Netflix instant streaming represents a major step into the future of content delivery, both for movies and for TV Netflix is beginning to provide some competition for cable companies, whose prices have gotten out of control
  8. 8. Hastings' Entrepreneurial Genius Every step of the way, Hastings has planned for the future, ensuring that Netflix would not be buried in the dust of technological innovation Even in 1997, Hastings knew to name the company "Netflix," not "DVD's by Mail" Netflix has consistently stayed one step ahead of the competition, especially since the launch of Netflix Streaming in 2005 Hastings' success should be a model for aspiring entrepreneurs
  9. 9. Bibliography Abkowitz, Alyssa. "How Netflix Got Started." Fortune 28      Jan. 2009. Print. Hastings, Reed. "How I Did It: Reed Hastings, Netflix." Inc.com. 1 Dec.      2005. Web. 10 Feb. 2010. <http://www.inc.com/magazine     /20051201/qa-hastings.html>. Maney, Keven. "Netflix Plans Blockbuster Future of Serving Movie     Watchers." USA Today 16 June 2004. Print.
  10. 10. Bibliography, cont. Riley, Jason. "Movie Man." The Wall Street Journal [New     York, NY] 9 Feb. 2008, Opinion sec.: A9. Print.   Roth, Daniel. "Netflix Inside." Wired 1 Oct. 2009. Print.

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