Ten years ago, when I drove on Winchester Avenue in Los Gatos, I saw this new company called Netflix that was renting DVD’s of movies. You did not have to go to a store, but sign up for the service of home delivery of DVDs. Now Netflix is building a much bigger headquarters building near its old site. It is huge success story – a disruption to the home entertainment business. When it decided to switch to “streaming only” few years back, there were lot of doubters. But that’s all past now. It is a global company now with huge success as a business.
Reed Hastings, co-founder and CEO, just announced this morning at CES in Las Vegas, that they have started their operation in 130 new countries – “Today you are witnessing the birth of a new global Internet TV network. With this launch, consumers around the world – from Singapore to St. Petersburg, from San Francisco to Sao Paulo – will be able to enjoy TV shows and movies simultaneously – no more waiting.”
Netflix has been producing its own contents over last few years and some of its shows have been huge successes. It releases all episodes (e.g. House of Cards) at once and this has created the “binge-watching” phenomenon. Audiences like to watch many episodes at one time (instead of weekly shows). You watch your own content at your own time and at any location using mobile devices or the TV.
Besides contents, its use of big data and analytics is very effective in understanding audience preferences and giving recommendations. The engineering team at Netflix continuously apply the latest technologies to enhance scale and performance. Now with a global reach, the challenges will grow.
Netflix is a real success story of a new-age disruptive force in the TV entertainment industry.