...the Effects of Netflix’s Innovation of the Value Chain? Source: (Netflix, n.d.a) WS 15/16 Current Issues in Media and Communication 1 Table of Contents • Key Slides • Getting to know Netflix • Disruptive Innovation of the Value Chain • Effects of the Innovation • Outlook • Bibliography WS 15/16 Current Issues in Media and Communication 2 Key Slides 1/3 Netflix can be regarded as a service business model within the video-ondemand area. It is known for being the pioneer offering its users entertainment content for a subscription fee. Since the foundation of Netflix in 1997 the new business concept turned into a success story with more than 70 million members around the world. People in 190 countries have access to Netflix‘s wide range of media entertainment possibilities and Netflix plans to add more to its list. The fact that their previous expansion meant 130 new countries in one go forecasts that Netflix will become a very important and influential global player in media entertainment industry. But how does all of it start? Innovation was the key. Netflix’s success in the new video rental business was based on the idea to offer an online DVD mail service. Adding new technology to a breakthrough idea created a combination which was meant to succeed. WS 15/16 Current Issues in Media and Communication 3 Key Slides 2/3 The users of the Netflix service are those who pay for it. In exchange to their subscription fee...
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...Course Project Walt Disney and Netflix Michael Wilson Keller Graduate School of Management Managing Organizational Change HRM 587 Professor Swift Course Project Walt Disney and Netflix Course Project Proposal For my course project I choose Walt Disney and the Netflix companies. I choose these two companies because I believe they are both going through significant changes in the way they are offering forms of the entertainment they provide. How they respond to the external forces that are requiring them to change has been different based on their resources and the demand their customers have. One company has many years of providing entertainment to many generations who value their judgment delivering quality products through many different mediums. The other company is new to the entertainment providing industry and has changed how businesses in that industry think about what their customers need based on the changes in the new technology developed in the past few years. For Walt Disney the changes will be how to maintain a quality relationship with the generations of customers who have purchased their movies in different formats that are no longer adaptable in the newest technology. Can they convince the owners of the video tapes that ownership of their products in other formats is still the answer? For Netflix the changes include a system that goes against the need to own the products, but trust that they will provide the entertainment they want when and where...
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...NETFLIX case Summer I, 2013 Company’s status On-demand Internet streaming media and DVD-by-mail service Year founded 1997 Employees: 900 at corporate headquarters. 36 million members in 40 countries. 1 billion hours of TV shows and movies per month. Customer satisfaction score of 86% * Netflix is the world’s leading internet subscription service *According to the American Customer Satisfaction Index (ACSI), Internet Strategy GOAL: Proving the best online rental online experience for the customers. Great website: Easy access to information. Direct and attractive. Fast Privacy Policy: collect data: customer’s information Payments and communication plans. Cookies Social networks. Share information. Personalized online customer service Information Technology New and advanced technology to improve its service. Advanced technology: Cloud computing. Proprietary software Strategic partnerships Efficient operations. Fast and high quality. Measuring customer response and experiences. Building customer profile. Collecting customer Data. Netflix has changed the way you watch your TV & movies Company that revolutionized watching of movies and TV Shows Culture of Innovation Netflix is the world’s leading internet subscription service Disruptive innovation. HALLMARK of the company Innovation focus: online streaming. Instantly from multiple platforms. Future GOAL: Keeping the leading position...
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...Netflix Domestic Strategy Prepared for: Netflix Senior Management Reed Hastings, Co-Founder and CEO Kelly Bennett, Chief Marketing Officer Jonathan Friedland, Chief Communications Officer Bill Holmes, Chief Business Development Officer Neil Hunt, Chief Product Officer David Hyman, General Counsel Patty McCord, Chief Talent Officer Ted Sarandos, Chief Content Officer David Wells, Chief Financial Officer August 4, 2012 Through this report, our consulting team has taken the opportunity to analyze and provide recommendations for future domestic business strategy of Netflix. As expressed in the company’s founder’s conference last October, we would like to help you build upon your stated vision for the future including: • Becoming the best global entertainment distribution service • Licensing entertainment content around the world • Creating markets that are accessible to film makers • Helping content creators around the world to find a global audience We would also like to follow the nine values you use to guide your company: • Judgment • Productivity • Creativity • Intelligence • Honesty • Communication • Selflessness • Reliability • Passion In this report, we will address the following issues to provide a foundation for overcoming Netflix’s domestic challenges: I. Competitive Dynamics A. Key Competitors B. Competitive Response II. Strategic Management/Competitive Issues A. Key Strategic Issues B. Strategic...
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...Elements of a Marketing Plan Report XXXXXX MKT/421 April 13, 2016 XXXXXX * Elements of a Marketing Plan Report In this day and age marketing strategies must keep up with the changing time in technology and how society sees the world in order to stay relevant. Marketing is a business technique used by companies to maintain, satisfy, and make a profit from their customers while staying successful. The company chosen to be discussed in this paper is Netflix. First, this paper will explain the specific key environmental forces created for opportunity for the company. Second, it will discuss five environmental forces and trends to influence the company’s marketing efforts and future product offering. Then, this paper will explain what differentiation strategy the company should undertake to encourage their target market over other competitors. Lastly, it will analyze lessons learned from the Geek Squad case study. Environmental Forces Netflix is a DVD rental and online streaming service. The key environmental force created for the company when they first started out is the DVD mail service. Before there was Netflix, customers had to go to rental stores such as Blockbuster to rent movies. One issue that customers would have is the stores running out of the movies they wanted or possibly not even carrying those movies to begin with. Shipping the movie gives customers more time and takes less energy than having to drive to the store to pick out what movies they...
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...Elements of a Marketing Plan Report Carolyn Gaston MKT/421 April 11, 2016 Kenyetta Rivera Elements of a Marketing Plan Report Introduction Marketing strategies must be able to keep up with the ever changing times of society, technology, and media. Companies use marketing as a business technique to maintain customer satisfaction, recruit new customers and make a profit from their customers while staying successful. To do this they must have a product that meets the needs of their customers. Customers become loyal clients who will speak well of your product to fellow consumers when they are getting a product that meets their needs. Environmentally, the use of Netflix’s DVD mail service shipping takes less time and energy then actually driving to a video store. Reed Hastings, the founder of Netflix, realized there was a need in the movie rental industry. He came to the realization that sending DVD’s through the mail, was something that customers would prefer to do rather than wait in line. Netflix started out purely as a DVD by mail service but began video streaming in 2007. Prior to Netflix, if a customer wanted to watch a movie at home they had to wait in line to buy it from either Blockbuster, Hollywood Video or local area movie stores. Occasionally, these stores would run out of movies and there was not a large selection of movies for customers to choose from. This would mean that in order to get the movie that you wanted you had to put your name on the waiting list...
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...Netflix Netflix was founded in 1997 in Scotts Valley, California, USA by two entrepreneurs named Reed Hastings and Marc Randolph. In its early days, Netflix offered unlimited movie rentals to its subscribers without due dates for a flat monthly fee with no per title rental, shipping or handling fees or late charge fees. In 2007, the company introduced new business model based on video on demand via the Internet, which was considered by some to be a departure from its original business model of movie rentals. With video streaming, online DVD and Blue-ray Disc rental tripod and with a global streaming subscribers of over 50 million, Netflix reported a revenue of US$4.37 billion US$112 million of which being net income and a total asset of US$5.4 billion in 2013. The company estimates its total equity to be US$1.33 billion and it has over 2000 full-time employees (www.netflix.com). Netflix’s vision as expressed by one the co-founder focuses on global distribution, licensing entertainment contents across the world, market accessibility for film makers, and finding global audience for content creators. (10K Item 1). It’s mission emphasizes growing global streaming subscription business, continuous customer experience improvement, enhancing user interface while at the same time remaining profitable. Mission. Netflix core values revolve around judgement, productivity, creativity, intelligence, honesty, communication, selflessness, reliability and passion. Tepper (2014)...
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...Background Netflix is an American provider of on-demand internet streaming media and flat rate DVD-by-mail that was established in 1997 in Scotts Valley, California by Marc Randolph and Reed Hastings. The concept of Netflix came to fruition when Hastings was strong armed into paying $40 in late fees after returning a movie well past its due date. Hastings’ initial investment of $ 2.5 million was to be used as start up cash for Netflix. The Netflix website was launched in April of 1998, employing a mere 30 employees and offering a limited selection of 925 movies available for rent via an online pay-per-rental model costing $4 per rental plus $2 shipping and late fees applied. In September of 1999 the month subscription concept was introduced, thereby eliminating the pay-per-rental model in early 2000. Netflix built a reputation on their business model of flat-free unlimited rentals without due dates, late fees, shipping and handling or per title rental fees. Netflix had their initial public offering (IPO) on May 29, 2002 selling over 5 million shares of stock at $15 a share and in June of the same year Netflix sold an additional 825,000 shares of stock at the same price. By 2005 Netflix had grown substantially, they were now offering over 35,000 title films and they were shipping a million DVD’s a day. In 2007 after delivering its billionth DVD Netflix began moving away from the business model of mailing DVDs and introduced video-on-demand via the internet. In September...
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...Netflix Rebecca Zent Managerial Finance December 15, 2015 Company & Industry Overview Netflix is the world’s leading Internet television network with over 69 million members in over 60 countries enjoying more than 100 million hours of TV shows and movies per day, including original series, documentaries and feature films. Members can watch as much as they want, anytime, anywhere, on nearly any Internet-connected screen. Members can play, pause and resume watching, all without commercials or commitments. The DVD-by-mail is where DVD’s and Blue-ray disks are sent via permit reply mail. The company was established in 1997 and is headquarters are in Los Gatos, California. It started its subscription-based service in 1999. By 2009, Netflix was offering a collection of 100,000 titles on DVD and had surpassed 10 million subscribers. People love TV content, but they don't love the linear TV experience, where channels present programs only at particular times on non-portable screens with complicated remote controls. Linear TV was a huge advance in entertainment over radio, just as fixed-line telephone was an advance in communications over the telegraph. Now Internet TV - which is on-demand, personalized, and available on any screen - is maturing and will eventually replace the linear TV experience. The world's leading linear TV networks now offer their programming on-demand through apps that run on phones and smart TVs. These apps, such as CBS All Access, BBC iPlayer...
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...Netflix: Past, Present, and Future Innovation Entrepreneurship & Innovation Strategy: Section #2 Chuck Culp, Mike Friedman, Graham Lincoln, Quentin Reeve, and Matt Zepernick 1 Introduction Netflix is an interesting company because it sits in an ever-changing ecosystem populated by old and new economy players. On one side, you have movie and TV studios that produce feature-length movies and serialized TV shows that are, in many ways, identical to the movies and TV shows that were produced when the medium was invented. On the other side, you have a rapidly-evolving set of computer-enabled devices and data transmission systems that allow consumers to access the studios media content in virtually any location with a power source and a fast Wifi connection. As a distributor, Netflix has been forced to evolve with these changes, and changes in content consumption methods have had a major impact on the home entertainment ecosystem and the profitability and power of the players involved. The paper is organized into three sections. The first section investigates the circumstances and decisions that helped Netflix launch successfully in 1998. The second section looks at Netflix’s approach to and experience in the internet video streaming business. These sections were selected because they offer rich case studies on entering and managing an evolving ecosystem. The final section considers the future of the Company and the steps that they can take to increase value capture in the future...
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...An open Internet has been a part of modern culture for almost two decades now. Our expanding digital borders have given rise to a new marketplace for business, entertainment, education, and communication. This burgeoning new environment has become what it is today largely due to it's low barriers to entry, speed, and wide reach (“The Information Age”). An underlying principle that has enabled the success of the Internet is that of network neutrality, a term coined by Columbian Law School Professor Tim Wu in regards to how networks, and more importantly Internet Service Providers (ISPs), handle data. Having come under attack in recent years, the need to defend Net Neutrality and to require the companies which provide Internet service to adhere to regulations in defense of their consumers has become even more important. Tim Wu goes so far as to give an example of the Neutrality Principle and his vision of a law enforcing net neutrality: “Broadband Users have the right reasonably to use their Internet connection in ways which are privately beneficial without being publicly detrimental. Accordingly, Broadband Operators shall impose no restrictions on the use of an Internet connection except as necessary...” (166). The principle itself, while attempting to...
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...Environmental Tutorial | Pressures for Change Matching Interactive | References The theory and practice of change management for organizations encompass a wide breadth of behaviors, perceptions, activities, planning stages, and even political scenarios. As we lead you through this course, please plan to research and review the many current events and discussions about leadership and business which are available in business publications, online research, and the Keller Graduate School of Management library. | | Change Management for the U.S.A. | | Think for a moment about the U.S. government. A large portion of the Constitution, and in fact, our national perception, creates a method of changing our leadership every four to eight years. When this change happens, people are divided or joined, exhilarated with hope, or paralyzed with fear. The U.S. government is like an organization – the best ones have a plan for change, keep it somewhat flexible, but create a foundation for comfortable yet fluid movement through a business continuum. Successful companies keep a concept of continuous improvement (in products, service, and efficiencies) always in the forefront. Whereas the U.S. plan for change is not so flexible, it does take into account the considerations of nearly all legal stakeholders (the voters). Of course, that concept may be debatable, but that isn’t the subject of this course. Successful change managers also keep stakeholders’ interests in mind during change. When...
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...International Expansion 6 ANALYSIS 6 Industry Analysis 6 Business Model 8 Company Analysis 9 Competitor Analysis 11 Amazon 11 Blockbuster 12 Redbox 13 ALTERNATIVES 13 Additions of Subscription Fee Package 14 Introduction of Netflix' Pay-For TV Channels 15 Domestic Elimination of DVD-mail-in Services in 16 Strategic Partnerships 17 International Expansion 19 Market Strategy 20 RECOMMENDATION 22 CONCLUSION 26 REFERENCES 26 EXECUTIVE SUMMARY Netflix is the world’s leading subscription service provider, offering its members access to an extravagant collection of TV shows and movies. Initially, the company offered its subscribers a low price, single monthly plan, consisting of both the unlimited Internet video streaming service and a DVD-mail-in service. Subscribers could “watch TV shows and movies anytime, anywhere.” In July 2011, Netflix eliminated the combined plan and separated the two services into their own monthly plans. If subscribers wanted to continue receiving both services, they were obliged to sign up for both the services separately, Consequently, the resulting price increase of the new “combined” plan significantly increased subscription cancellations and resulted in a 50% drop in Netflix’ share price over one month ( Yahoo Finance, 2013). The Internet video streaming industry becoming increasingly more competitive, particularly due to the fact that many substitutes exist and number of competitors is increasing. In addition, the...
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...Duane Lefevre Netflix Case Analysis Summary To “Netflix” is fast becoming a common word in today’s society. Everyone knows it, because it is very famous for its service of online movie. It has replaced the traditional DVD rental store and all the rental process can be done through internet with a higher image quality. Reed Hastings incorporated in 1997 and starting movie rental service in 1999. In 2012, there was already over 23 million subscribers and more then 120,000 titles available for online streaming, majorly competing with Hulu Plus and Amazon prime instant video. Analysis Porter five forces analysis The Porter’s five forces model is often used to analyze companies’ level of competition within an industry and business strategy. The rivalry among existing competitors is intense. There are a large number of firms in the movie rental industry and the competition is very high. Several methods for consumers to choose from in-store rental, online rental and mail delivery or video on demand and low level of product differentiation also increase rivalry. There are low switching cost which also lead to aggressive competition and comparable product can be found at many different places. In brief, Netflix major competitors have large levels of capital and also achieved economies of scale. The threat of new potential entrants of Netflix is soberly low...
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...Summary Netflix is the world’s leading online streaming media company. By entering licensing agreements with major film studios, Netflix is able to distribute movies and TV shows online for a low monthly price. The 57 million streaming members in 50 countries can watch as much as they want from the content library, as long as they have an internet connected screen. Since 2007 they have pioneered delivery of TV shows and movies on a newly developed ecosystem that enables consumers to enjoy TV shows and movies directly on their TVs, computers and mobile devices. The company has three reportable segments: domestic streaming, international streaming and domestic DVD. The domestic and international streaming segments derive revenues from monthly membership fees for services consisting solely of streaming content. In the United States, members can receive DVDs delivered quickly to their homes, which is an additional 5.7 million users and 32% of net income even though it is on rapid decline. The domestic streaming content membership is 39 million members versus the international which is 18 million. In today’s market, there are several risk factors that Netflix faces and needs to handle to be competitive in the future. Some of these risks are the high licensing costs for the content they host, high reliability on other sources for streaming to customers devices and the need to constantly improve and innovate their corporate strategies (Netflix, 2013). Netflix expansion...
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