AbstractJust a decade ago the idea of an online streaming Essay


Just a decade ago, the idea of an online streaming provider possibly would not be easy to predict since the technology and storage was not in the advanced level as it is nowadays. The report is referring to Netflix company and how its business model achieved to place the company in the first place of the competition. Reasons and ways the company uses comparing to other companies in the same field will be analyzed in order to have a better idea of company’s success.

Moreover, this report will analyze the way that Netflix differentiates from other companies and how critical is to keep their costumers satisfied.

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The way that people are watching television in recent times is some distance exclusive from how television became consumed just ten years ago.

The structure of this report is as follows. The first part is analyzing the services of Netflix Inc. from the beginning until nowadays where the technology has changed. Moreover, the second part describes why costumers choose this company.

Several reasons are the combination of costumer’s choice, but what about the competition? Questions during the third part such as how critical the existence of competitors is and how Netflix’s business differentiates from their competitors will give an idea of the competition map. Finally, part four explains possibly dangers in the near future and briefly discusses different ways of operation.

Netflix – in full Netflix, Inc., is a media streaming and video rental company founded by American entrepreneurs Reed Hastings and Marc Randolph in 1997, is the country’s largest online rental DVD service. It involves also the creation of original programming. Company’s headquarters are located in Los Gatos, California (Hosch, 2019). Netflix as a virtual corporation has twisted the suggest of speaking to the target market. The organization has offered an alternative to classic television (Allen, Feils & Disbrow, 2014).

The multinational company gives the opportunity to the customers to have access to on demand Internet television and streaming media and DVD via mail. To be more accurate, Netflix’s customers have the advantage of the internet and watch unlimited shows and films (Kazi, 2011). Netflix provides a monthly flat rate service for renting DVD movies and video games. In 1999 Netflix commenced offering an online subscription provider via Internet. Subscribers selected films and television titles from Netflix’s Internet website. At the beginning the shows have been mailed to customers inside the shape of DVDs, together with prepaid return envelopes, from one among more than a hundred distribution centers. Even though customers commonly rented for a flat month-to-month price as many movies in keeping with month as they wished, the range of DVDs of their possession at any one time changed into restricted according to their subscription plans. Moreover, Netflix has a separate library consists of tens of hundreds of films in many categories and customers can subscribe and watch following the proper way on their laptop systems. The company operates in approximately 193 countries and ranked as the world’s leading organization in the provision of internet television (Hallinan & Striphas, 2016).

But what are the reasons of choosing to subscribe Netflix?

?he combination of several reasons is the one that combines its table why customers prefer subscription to Netflix. Affordable cost, simultaneously log-in, absence of advertisements, many choices of series – movies – TV shows, any time un-subscription, and many other reasons gives Netflix the first place in customer choice.

Customers are paying a monthly flat rate service, and they have the opportunity to choose among a big library or films, series and TV shows without having commercials to interrupt each program. This is a big advantage since subscribers can watch whatever they have chosen to watch without loss of time in contrast of watching a movie on TV with numerous interruptions for advertisements.

Customers want to have at their disposal the films, the series at any time they want, anywhere they want and from any device – such as laptop, mobile phone, tablet and more – is available the moment they want to. Giving at the same time easy access to subscribers to watch movies, series and shows in many devices simultaneously is a very attractive service, for example a family can simultaneously log in two or more devices, depending on the program they have chosen.

Furthermore, Netflix is getting personalized using algorithm which counts, track a history of what subscribers watch. In that way the company makes the subscriber’s profile according to past selections, the five star rating system, scrolling interest, and viewing habits, and with the algorithm groups together carefully related or “neighboring movies” (films made via the same director or the same actors, films in the same alt-style, films with comparable themes, and so on). (McDonald & Smith-Rowsey, 2016: p.90)

How many times we have made a thought of saving the program we are watching for a later time? Netflix gives you this opportunity adding the program to “My List”. That is the sort of outstanding choice, particularly in case you are planning to move on or if you are planning to go on holiday. Probably you will not have an awesome internet connection, in order to be capable to see on line the preferred films or shows. But, Netflix will make it looking and search what are the needs of their customers and works every day to improve its ability to keep costumers satisfied with innovating technology such as user interface. For that reason, all the subscribers can download the preferred program giving them the choice to watch it whenever they want regardless of where they are.

Another important factor that Netflix is preferred by customers is that it is safe for the children since has the potential to have separate profiles in the account. This sounds very good as a parent, because parents may create a profile to their kids and restrict them from seeing any age-beside the point films or tv indicates.

Even if the company’s popularity is increasing around the world, the United States continues to be the most important market, accounting for 7.2 billion dollars in streaming revenue having 57 million subscribers. Taking into consideration all the above reasons of choosing Netflix and the statistics, Netflix costumers are adults who have already a music of video subscription. Approximately 59 percent of U.S. based adults had a Netflix subscription as of 2018, and 70 percent of all adults with a music or video subscription use Netflix. (Topic: Netflix. 2019)

Netflix operates in a market with a very big competition, looking to keep their costumers satisfied. This is what gives the motivation to Netflix to try with steady efforts to enhance and innovate. Netflix’s achievement is very big especially if someone thinks about its competition. (Mauro, 2019)

Competition in streaming television is becoming crueler and still stays a big challenge for Netflix (Steel, 2019). A strong competition threatens the company’s market share so far. (UK Home | Investopedia. 2019). Main competitors of Netflix are Amazon.com, Hulu and HBO Now – the four major companies of streaming services. But what differentiates Netflix from their competitors? One of the most important things that differentiates companies is their market share. In March 2017, Netflix had attracted nearly 48 million home subscribers. Nowadays, Netflix has nearly 55 million. Hulu, meanwhile, closed out 2017 with 17 million subscribers globally (service available in the U.S. and Japan). All this is set to change when Disney receives a majority shareholding after the 21st Century Fox acquisition has been approved. Amazon originals attracted more than five million individuals to top among past due 2014 and early 2017 (Katz, 2019). Netflix is beating its competition in the quantity of authentic tv shows and films it has, and new information shows that the streaming large is major in first-rate films, too (Clark, 2019).

Netflix is in the first place in the competition of streaming–this is not a concern. What is concerning is the worries regarding programming costs and stock valuation related to stock market over the next several years. This can cause some problems; Netflix could still be a long-term winner (Mauro, 2019). The best thing is that no direct competitor to Netflix is at the same place with regards to high-quality and rate (UK Home | Investopedia. 2019). And what makes Netflix being in the first place? They are interested on what the costumers like to watch, proposing them next films, series or TV shows. Netflix shows to know their costumers, and this is a big advantage on the streaming industry.

Having to deal with many competitors but also the rapid development of Internet-related technology. In my opinion Netflix must focus on the low-cost subscription which is one of the most critical factors for the costumers. Low cost for a service like on line streaming can be very attractive even for older people. Several offerings such as more than one-month trial for new costumers, make over movies, more categories will give a hint to the company. Costumers must feel they are unique, and Netflix can gain them with personalized lists, without knowing the way that Netflix is collecting their preferences but giving them the essence of being unique.


In conclusion, Netflix has been very successful in the streaming industry. Company started by renting DVD on a monthly basis, but they soon realized that due to the evolution of technology, it had to offer more services to customers. They took the advantage of the Internet and they managed to adapt costumers needs and made the difference in contrast to other companies that they did not adapt the needs of the people.

Netflix is an example of a business that developed a very good system for their costumers, and they gain the attention of economy and business.

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