Netflix, a Web 2.0 Company
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Overview
Netflix is the worlds largest online DVD and Blu-ray disc rental service, with more than 11 million current subscribers. Netflix members
who subscribe to their basic $8.99 a month plan, gain unlimited access to over 100,000 titles through mail, and over 17,000
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titles that they can watch instantly from their Computer or Netflix-ready device. This plan allows memebers to rent 1 movie at a time,
includes free shipping in both directions, no late fees, and you can exchange them as often as you like.
Netflix was Established in 1997 by Founder and CEO, Reed Hastings. The Company is headquartered in Los Gatos, California, and
has over 2000 employees worldwide. Out of the company's 55 million disc collection, on average it ships out 1.9 million to customers
each day.[1]
Services
Limited Plan
$4.99 a month
1 DVD out at-a-time
(Limit 2 per month)
plus
Instantly watch up to 2 hours of movies & TV episodes online on your PC or Mac.
Unlimited Plans
$8.99 a month
1 DVD out at-a-time
(Exchange each DVD as often as you want)
plus
Instantly watch online on your PC or Mac or right on your TV via an Internet connected
Netflix ready device. Instantly watch as often as you want, anytime you want.
$13.99 a month
2 DVDs out at-a-time
(Exchange each DVD as often as you want)
plus
Instantly watch online on your PC or Mac or right on your TV via an Internet connected
Netflix ready device. Instantly watch as often as you want, anytime you want.
$16.99 a month
3 DVDs out at-a-time
(Exchange each DVD as often as you want)
plus
Instantly watch online on your PC or Mac or right on your TV via an Internet connected
Netflix ready device. Instantly watch as often as you want, anytime you want.
Blu-ray Access
The Blu-ray access charge varies by plan:
• 1 DVD out at-a-time (exchange each DVD as often as you want)
– additional $2 a month
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• 2 DVDs out at-a-time (exchange each DVD as often as you want)
– additional $3 a month
• 3 DVDs out at-a-time (exchange each DVD as often as you want)
– additional $4 a month
• 1 DVD out at-a-time (limit 2 per month)
– additional $1 a month
Watch Instantly
Watch Instantly includes some new releases, lots of classics and TV episodes
Over 17,000 streaming choices.
Instantly watch movies & TV episodes online on your PC or Mac or streamed instantly from
Netflix over the Internet right to your TV via a Netflix ready device. This is included
with your membership for no additional monthly fee and doesn’t impact the number of DVDs
you get by mail.
Web 2.0 Concepts
Leveraging the long tail
Long Tail business can treat consumers as individuals, offering mass customization as an alternative to mass-market fare. For the entertainment industry itself, recommendations are a remarkably efficient form of marketing, allowing smaller films to find an audience. For consumers, the improved signal-to-noise ratio that comes from following a good recommendation encourages exploration and can reawaken a passion for film, potentially creating a far larger entertainment market overall. (The average Netflix customer rents seven DVDs a month, three times the rate at brick-and-mortar stores.)
There are any number of equally attractive genres neglected by the traditional DVD channels: foreign films, anime, independent movies, British television dramas, old American TV sitcoms. These underserved markets make up a big chunk of Netflix rentals. Netflix has made a good business out of what's unprofitable fare in movie theaters and video rental shops because it can aggregate dispersed audiences. What matters is not where customers are, or even how many of them are seeking a particular title, but only that some number of them exist, anywhere.[2]
Collective Intelligence
Netflix improves their offerings by incorporating user input. Members who rate movies receive better guidance on how many stars they’re likely to give movies they haven’t seen. These star predictions influence the movies featured on many pages of the Netflix website, in particular in the "Movies You’ll Love" area. These star predictions are used so members can create even more personalized websites that make it faster and easier to explore the more than 100,000 titles available on DVD and Blu-ray disc and the more than 17,000 streaming titles at Netflix. [3]
Software Above the Level of a Single Device
A Web 2.0 concept that Netflix has nailed with their "Watch Instantly" feature is that it's no longer limited to the PC platform. In his parting advice to Microsoft, long time Microsoft developer Dave Stutz pointed out that "Useful software written above the level of the single device will command high margins for a long time to come." [4] By integrating Microsoft's proprietary VC-1 video codec in combination with Microsoft Silverlight, Netflix's "Watch Instantly service is supported on both the Windows and Mac OS X Platforms.[5] The various software options include:
- Internet Explorer 6 (or higher)
- Firefox 2 (or higher)
- Safari 3 (or higher)
- Silverlight Player
- Boxee
- Zinc
- Windows Media Center
- PlayOn
- Plex
- MediaPortal
Along with streaming to various PC and Mac clients, Netflix has formed partnerships with various electronic manufacturers to stream movies directly to their devices. These manufacturers include:
- Insignia Blu-ray Disc players
- LG Blu-ray Disk players and TVs
- Microsoft Xbox 360
- Roku set-top box
- Samsung Blu-ray Disk players
- Sony TVs and PlayStation 3
- TiVo DVRs
- Visio TVs
References
[1]. Netflix, Inc. 11/4/2009 <http://www.netflix.com/>.
[2]. Anderson, Chris. "The Long Tail ". Wired. 11/4/2009 <http://www.wired.com/wired/archive/12.10/tail.html?pg=3&topic=tail&topic_set=>.
[3]. "Netflix Improves Recommendations". Briki Media. 11/4/2009 <http://www.hackingnetflix.com/2009/05/netflix-improves-recommendations.html>.
[4]. O'Reilly, Tim. "What Is Web 2.0". O'Reilly Media. 11/4/2009 <http://oreilly.com/pub/a/web2/archive/what-is-web-20.html?page=1>.
[5]. "Netflix". Wikipedia. 11/4/2009 <http://en.wikipedia.org/wiki/Netflix#Watch_Instantly>.