Netflix Presentation

2. The Birth of Netflix
Creation
Reed Hastings started Netflix in
1997
Idea came from $40 late fee
from a video rental
The heart of the idea: a mail
based movie rental business
Trial Run
Reed bought several CDs and
mailed them to himself
Result: (1) It only took 24 hours
before they arrived; (2) DVDs
came in perfect condition

3. The Birth of Netflix
Beginning
Hastings launched a
subscription service with a free
trial in 1999
Only 20% of free trial users did
not convert to paid service
Success
In 2003, Netflix recorded profit
and reached 1 million
subscribers
At this point, Hastings knew
Netflix was successful

4. The Birth of Netflix
The Second Wave
In 2008 Netflix offered instant
online streaming of TV shows
and movies
Brought streaming capabilities
to people via blu-ray players,
game consoles, and internet
site.
Comprehensive Video
The following video highlights
Reed Hastings and his idea of
Netflix

5. Since its founding…
• How many global members does Netflix have?
Answer: nearly 70 million
• How many countries is Netflix in?
Answer: over 60
• What is Netflix’s approximate
market cap?
Answer: $53.61 billion
• How many hours per day do users watch
Netflix?
Answer: Over 100 million hours

6. Why people use Netflix
Affordability
Multiple subscription plans
Multiple platforms to
access
(Apple TV, Xbox, PS4, Wii)

7. Why people use Netflix
Library of
content
Learns people’s
preferences
Simplicity and ease of
use

8. Why people use Netflix
Word of mouth →
compatibility with existing
values
Social norms and
sense of identity
Autonomy given to
user

9. How people use Netflix
Framework provided by technology:
Users can access relevant content when and where they want
it
What does this look like?
Feelings before/after…
Time of day…
Device(s)…

10. Netflix: Individual or Community
Oriented?
Individual
A separate digital dimension
Unique user profile
Catered to individual’s preferences
Available on-demand in virtually any
context
Social
Access to content watched by masses
A means of socializing
Integration of Netflix and Facebook:
Click here

11. Cultural Habits
Netflix and Chill
• A slang term that started on Twitter in 2007
• Ex: “Can’t wait to leave work so I can Netflix and
Chill”
• Meaning now varies depending on generation
• Possible meanings:
• (1) Simply watching Netflix/relaxing; (2) “hooking
up”
• Part of mainstream vocabulary; example of
technological determinism
• CEO Reed Hastings on the term: Click here

12. Cultural Habits
Binge Watching
• “Consuming an entire TV series at once, rather than weekly”
• Result of content that is released “all at once” instead of in segments
• 61% of Netflix users binge watch shows at least every few weeks
Why does Binge Watching occur?
• Cliffhangers activate stress
• Completing an episode triggers serotonin and dopamine
• Strategic length of shows: 20 or 40 minutes
• Netflix makes people happy

13. Cultural Habits
The Netflix Switch
• A prototype device created by Netflix engineers
• Purpose is to streamline people’s Netflix viewing experience
When activated, it…
• Dims the lights
• Switches nearby phones to silent
• Orders takeout
• Turns on Netflix
Watch a short video here; Explore the switch here

14. Netflix and Traditional TV
Netflix and Streaming
• Greater viewer flexibility and
autonomy
• Dependent on Internet
• No primetime network competition
• No commercials
• Personalized suggestions
• Watch on a variety of mediums
Traditional Television
• Predetermined programming
• Less viewing autonomy
• No Internet needed
• Primetime network competition
• Commercials
• Standardized listings
Click: The nature of streaming

15. Cord Cutting: A Noticeable Trend
Patterns of viewers cancelling subscription TV services for
over-the-Internet subscription services

16. Cord Cutting
• What % of U.S. households subscribe to Netflix, Hulu Plus, or
Amazon Prime as of 2014?
• What % of U.S. households have at least one TV connected to
the Internet as of 2014?
Answer: 49%
Answer: 47%

17. Netflix and Identity
• First, click this to understand the highly personalized nature of
Netflix
Netflix is an extension of our:
• Likes and dislikes
• Values
• Temperaments
• Opinions
• The type of media you consume indicates an aspect of your identity
• Netflix identity can be true, intentionally created, or both

18. Netflix and Communication
World Brain
• Netflix is a vast library of content
• Algorithms make content come “alive”
• Similar to the layer of consciousness
surrounding world’s information
Filter Bubble
• The more you use Netflix, the more it
caters content to you
• Netflix creates a virtual identity around
your behavior

19. Social Construction of Netflix
Three Major Shifts of Netflix
If Netflix never evolved, it would not exist today
Each evolution of Netflix has been driven by a changing social dynamic
DVD rental by
mail disrupted
traditional
movie rental
companies like
Blockbuster
TV show and movie
streaming responded to
consumers’ desire for
autonomy and
convenience
Netflix Original
Series and other
content is directly
related to customer
input and popularity

20. How does Netflix choose what’s on?
• Incorrect framework: Netflix is a
“broad distributor” of content
• Correct framework: Netflix is an
“expert programmer.” What’s on
Netflix is what people watch the
most of. In a way, users produce
content
• Viewership/popularity of titles
weighed against cost of licensing
them
• Watch this video

21. Netflix Original Content
Netflix has produced a wide range of original content:
Examples: TV specials, series, movies, documentaries
Netflix originals cover popular topics:
Examples: politics, race, sexual orientation, drugs, and more

22. Netflix Original Content
• Identity shift: Netflix is assuming the role of a TV network
• Nearly 90% of Netflix members have engaged with Netflix
original content
• 45 Emmy nominations to date

23. THE END