SWOT Analysis: Netflix

1450 Words 6 Pages
History
In 1997, two software engineers named Reed Hastings and Marc Rudolph founded Netflix. Hastings got the idea of using the internet to rent movies on DVD after Blockbuster had charged him a late fee. Hastings wanted to create a place where late fees were voided. This is where the company would offer flat rate rental-by-mail to customers around the United States. Hastings thought to himself, that there had to be a better business model then charging late fees.
By 1999, Netflix launched a subscription service that would offer unlimited rentals for a low monthly subscription. This idea was the beginning of transforming the way people will rent and watch their favorite movies, never having to leave the comfort of their own home.
One year
…show more content…
Their core strategy of is to continue to grow their subscription based both domestically and internationally. Over the years, they were able to build an ecosystem of convenience for their users by being available on Smart TVs, video game consoles, TV box set, handheld devices, laptops, tablets, etc. Any device that is able to connect to the internet, it gives the user the ability to use their subscription to watch their favorite shows or movies. Netflix is looking to further expand their content and improve the user experience.
Weakness
DVD memberships has been steadying decreasing over time. It can be said that DVDs and Blu Ray are slowly becoming the VHS of today. Individuals are more about fast paced, instant satisfaction of online streaming. Since the beginning until mid-2011, Netflix had provided their users a hybrid plan of online streaming and DVD rentals. In July of 2011, Netflix decided to split the two plans giving their customers an option of either or. This caused an uproar where the company realized their mistake of splitting the plans. By the time December of 2011, 11 million users left Netflix to another 6 million users by September 2014. Even with this hit, Netflix is still able to become profitable but their performance could hurt if DVD memberships continue to
…show more content…
Canada was the first place to start off the internationally with Latin America and the Caribbean becoming the second area and finally with European countries slowly becoming part of the Netflix streaming business. “This recent addition into markets with over 60 million broadband households has significantly increased the company’s European presence, and raised its international addressable market to over 180 million broadband households.” (Value Line). The possibility of growth can be exponential if they continue to move forward. The market will continue to expand to Australia, New Zealand, and then to the Asia

Related Documents