By: KC Anderson, Jacob Landsberg, and Lars Ludwigs

Executive Summary

● Founded in 1998 by Reed Hastings and Marc Randolph

● Idea behind Netflix: combine the American´s love of movie with the desire for convenience

● Largest provider of on-demand media in the United States

● Differentiation strategy through its use of technology & data-driven business model

● Revenue model: Subscription based

● Competitors: Blockbuster, Redbox, Apple & Amazon

Netflix early years

IS Strategy Triangle

Background● Founded in 1985 by David Cook● American-based provider of home movie and video game rental services● “Bricks-and-Mortar-Approach”

○ Traditional rental business model - through video rental shops (both owned and franchised)

○ Later adde DVD-by-mail, streaming, video on demand & cinema theater● Revenue Model

○ “Á-la-carte-model”● At its peak in 2004, Blockbuster had up to 60,000 employees & more than 9,000 stores

● Blockbuster lost significant revenue & filed for bankruptcy on September 23, 2010

What did it do wrong?● Failed to adapt its ISST to the dynamic changing environment

● Tried to copy Netflix´s Business Model instead of creating new own one

● Inadequate replacements for leadership personnel in top management

● Lack of flexibility & convenience

Core Competencies

VOD

● Netflix Online● Netflix Instant● Netflix App● Own Original Content

Partnerships

● Price● Location● Convenience

Recommendations

● Expand Content Divisiono TV Showso Movies for theatre

● Expand Internationallyo EUo Asiao Australia

● Continued Innovation

Netflix: 2014 Netflix Long Term View

Internet TV is replacing linear TV.

Apps are replacing channels,

remote controls are disappearing,

and screens are proliferating.

As Internet TV grows from millions to

billions,

Netflix is leading the way around the

world.

Lessons learned

- Importance of adaptation to change in the industry

environment

- Stay innovating otherwise you’ll fall behind

- Efficiency in HR