Reed Hastings


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Reed Hastings

  1. 1. Reed Hastings Founder of Netflix BY NOLA BOOTH
  2. 2. Before Netflix  Joined the Peace Corps after Grad School  Founded Pure Software in 1991 as an engineer, a company based on a debugging tool for engineers  Became CEO of Pure Software in 1995  Pure Software purchased in 1997 by Rational Software for $750 million  Money from selling Pure Software used to found Netflix
  3. 3. How Netflix Began  1997- Hastings receives a $40 late fee for Apollo 13, embarrassed  DVDs not yet on the market, still the age of VHS tapes  Idea begins with rental by mail, not subscription based, minimal success  Decision to move on to subscription based plan- people sign up to pay a fixed amount per month for DVD rentals  Remarkable success, subscription renewal rate after free Netflix trial at 80% by 1999  Renewal rate up to 90% as of January 2009
  4. 4. How It Works  Users create a queue of the movies they want to watch  Users receive a movie in an envelope via mail that doubles as their return envelope  Users send back a movie to receive the next one on their queue Several plans available after free trial period:  1 DVD at-a-time for $8.99 per month  2 DVDs at-a-time for $13.99 per month  …….  All the way up to 8 DVDs at-a-time for $47.99 a month!
  5. 5. Advancements and Plans for the Future  Almost every subscription includes unlimited online streaming of movies  An additional device, such as a Roku (shown to the left), can be used to stream select movies from Netflix to a Television “Stay Flexible” -Hastings “We named the company Netflix (NFLX), not DVDs by Mail because we knew that eventually we would deliver movies directly over the Internet. DVDs will be around a long time, but we’re building for the day when they’re not.” -Reed Hastings
  6. 6. So Why Do We Care? So What?
  7. 7. I’ll Tell You!  Caters to “Americans’ love of But I don’t wanna. movies [and] their love of not getting off the sofa even to go to the video store” (Patrick J. Sauer) But perhaps more importantly… (or perhaps not):  Dealt with the late fee issue- When VHS tapes cost $70, or DVDs were new, late fees were necessary  Now that DVDs sell for under $20 In short… brand new, late fee is a needless punishment Made our lives easier!  Pushed competing video stores to work harder and make customers’ lives easier- beneficial for the consumers!
  8. 8. Works Cited  Abkowitz, Alyssa, comp. "How Netflix Got Started." Fortune 28 Jan. 2009. Fortune Magazine. CNN. Web. 21 Sept. 2009. <>.  Andrews, Paul. "Videos Without Late Fees Reed Hastings, Digital Entrepreneur." US News & World Report 29 Dec. 2003: 64. Proquest LLC. Web. 21 Sept. 2009. <>.  Graham, Adam. "Video Stores Getting Squeezed by Internet, On-Demand." Detroit News [Detroit] 28 Feb. 2005. Proquest LLC. Web. 28 Sept. 2009. <>.  Netflix. Web. 27 Sept. 2009. <>.  Sauer, Patrick J., comp. "How I Did It: Reed Hastings, Netflix." Inc. 1 Dec. 2005. Inc. Mansueto Ventures LLC. Web. 21 Sept. 2009. <>.  Schlosser, Julie. "Netflix Makes It Big In Hollywood." Fortune 13 June 2005: 34. Proquest LLC. Web. 21 Sept. 2009. <http://>.  Svennson, Peter. "Netflix Delivers Internet Films to TV." Pittsburgh Post-Gazette [Pittsburgh] 24 May 2008: A.9. Proquest LLC. Web. 21 Sept. 2009. <>.
  9. 9. Image Credit         The End.