add site
services
publishers
database
health videos
toolbar
stats
live show
health store
more stuff
JOIN/LOGIN
| advertise add site services publishers database health videos
| | about toolbar stats live show health store more stuff JOIN/LOGIN |
Video Fitness: Netflix for Fitness Enthusiasts videofitness.com |
Netflix (NASDAQ: NFLX) is an online DVD and Blu-ray Disc rental service, offering flat rate rental-by-mail and online streaming to customers in the United States.[2] Established in 1997 and headquartered in Los Gatos, California, it has amassed a collection of 100,000 titles and approximately 10 million subscribers.[3] The company has more than 55 million discs and, on average, ships 1.9 million DVDs to customers each day.[3] Netflix previously claimed to spend about $300 million a year on postage. On February 25, 2007, Netflix announced the billionth DVD delivery.[4] Two years later, on April 2, 2009, the company announced that it had mailed its two billionth DVD, and awarded the recipient with a complimentary lifetime membership. It topped the ForeSee Results’ Top 100 Online Retail Satisfaction Index with an American Customer Satisfaction Index score of 86, well over the industry average of 75.[5]
[edit] Services The company provides a monthly flat-fee service for the rental of DVD and Blu-ray movies. A subscriber creates an ordered list, called a rental queue, of movies to rent. The movies are delivered individually via the United States Postal Service from an array of regional warehouses. Currently, there are more than 50 shipping points located throughout the United States.[6] The subscriber can keep the rented movie as long as desired, but there is a limit on the number of movies (determined by subscription level) that each subscriber can have on loan simultaneously. To rent a new movie, the subscriber must mail a previous one back to Netflix in a prepaid mailing envelope. Upon receipt of the disc, Netflix ships the next available disc in the subscriber's rental queue.  As of July 24, 2007, Netflix's most popular plan cost US $16.99 (plus tax) per month, allowing a subscriber to rent up to three movies at a time, with unlimited exchanges. Other monthly plans range from US $4.99, for one disc at a time and a limit of two per month, to US $47.99 for eight with unlimited exchanges. For the three-out and eight-out plans, each rental slot costs the subscriber approximately US $6 a month. Netflix also sells gift subscriptions for various renting intervals, although the recipient must register using a major credit or debit card. Netflix offers their subscribers access to Blu-ray Discs for an additional fee depending on subscription package citing the additional cost of Blu-ray titles as the reason for the fee. This is a change from the original Blu-Ray fee implemented November 21, 2008. The new Blu-Ray pricing came into effect for billing cycles ending April 27, 2009.[7] In addition to its movie rental service, Netflix formerly sold used movies. The purchase was delivered via the same system and billed using the same payment methods as rentals. This service was discontinued at the end of November 2008.[8] [edit] Watch InstantlyNetflix has a "Watch Instantly" feature available to eligible subscribers. The feature enables subscribers, as part of their monthly subscription, to stream proprietary Microsoft VC-1 videos at lower or higher qualities than that available on DVD (typically affected by the user's broadband bandwidth, and more often by the processing power of their computer if using the newer Netflix/Microsoft Silverlight player). Initially, the feature offered subscribers one hour of media for approximately every dollar they spent on their subscription. (A $16.99 plan, for example, entitled the subscriber to 17 hours of streaming media.) In January 2008, however, Netflix lifted this restriction. Virtually all subscribers now are entitled to unlimited hours of streaming media at no additional cost. Only subscribers with a plan of $4.99/two DVDs per month, one DVD at a time, aren't provided unlimited access to the streaming service. (They are allowed two hours.) The new terms of the service are a response to the introduction of Apple's new video rental services.[9] Currently the Watch Instantly service features more than 17,000 movies and recorded television shows available.[10] Major studios including NBC Universal, MGM, 20th Century Fox, CBS/Paramount, ABC-Disney, Warner Brothers, Lions Gate Entertainment and New Line Cinema are all distributing films and television shows via the service.[11][12] On October 1, 2008 Netflix announced a partnership with Starz Entertainment to bring 2,500+ new movies and television shows to Watch Instantly in what is being called Starz Play.[13] According to CEO Reed Hastings, the Watch Instantly feature will become available to users outside of the United States during the second half of 2010. Web Browsers Supported by Platform:
Reliability concerns: Recent updates to the service have limited streaming media outputs to lower resolution displays (WMP11 requirement and component video outputs causes cryptic DRM reset error).[citation needed] Other software options:
[edit] ProfilesIn June 2008, Netflix announced plans to eliminate its online subscriber profile feature that fall.[16] Profiles allow one subscriber account to contain multiple users (e.g. husband and wife, or two roommates) with separate DVD queues, ratings, recommendations, friend lists, reviews, and intra-site communications for each. Netflix contended that elimination of profiles would improve customer experience.[17] However, likely as a result of negative reviews and reaction by Netflix users,[18][19][20] Netflix reversed its decision to remove profiles eleven days after its announcement.[21] In announcing the reinstatement of profiles, Netflix defended its original decision, "Because of an ongoing desire to make our website easier to use, we believed taking a feature away that is only used by a very small minority would help us improve the site for everyone." Then explained its reversal, "Listening to our members, we realized that users of this feature often describe it as an essential part of their Netflix experience. Simplicity is only one virtue and it can certainly be outweighed by utility."[22] [edit] Video game consolesSee also: Xbox Live#New Xbox Experience At E3 2008, Microsoft announced a deal to distribute Netflix videos over Xbox Live[23]. This service was launched on November 19, 2008[24] to Xbox 360 owners with a Netflix Unlimited subscription and an Xbox Live Gold subscription[25] allowing them to stream movies and TV shows directly from their Netflix Instant Queue from an application on the Dashboard.[26] In October 2009, Sony Computer Entertainment and Netflix announced that the service would also be available on the PlayStation 3 from November 2009. The set-up will be similar to that on the Xbox 360, allowing Netflix subscribers to stream movies and TV shows from their Instant Queue to watch on the console. Unlike on the Xbox 360, the Netflix application will be available on a Blu-ray disc initially (available free to subscribers) but it is expected that a downloadable application will be made available in the future. Also, as the PlayStation Network only has a single, free level of membership, users do not have to pay for use of the service other than the initial Netflix subscription.[27] Netflix CEO Reed Hastings hopes to bring streaming movies to the Xbox 360, PS3 and Wii consoles. [28] [edit] Manufacturing PartnersNetflix is now forming partnerships with electronics manufacturers to instantly stream movies directly to their devices. In May 2008 they released a set-top-box to stream Netflix's Watch Instantly movies. The device is manufactured by Roku and provides unlimited access to the Netflix streaming media catalog for subscribers with one-at-a-time unlimited plans and above.[29] In October 2008 Netflix agreed to instantly stream movies to two of Samsung's Blu-ray Disc players.[30] They soon after announced a partnership to instantly stream movies to TiVo DVRs.[31] In November 2008 they announced a partnership to instantly stream movies via Xbox 360 video game and entertainment systems.[32] In January 2009 Netflix announced a similar partnership with Vizio and LG to instantly stream movies directly to their high definition televisions.[33] In September 2009, Netflix CEO Reed Hastings expressed his desire to expand his company's video-streaming service to Nintendo's Wii and Sony's PlayStation 3 video game consoles as well as Apple's iPhone and iPod Touch mobile devices once the Xbox 360 exclusivity deal expires.[34] A PlayStation 3 service was officially announced in October 2009 to be launched in November 2009[27] Reports have surfaced that a Wii service will be introduced as early as the 2009 holiday season.[35] No game system or device is needed to stream movies directly to a TV. All new LCD and Plasma TV's will readily accept input from a desktop or other CPU. This quality is comparable with the other streaming systems. Older Tube TV's will require a video card and will offer a reduced picture quality. See also: List of Netflix Instant Watch Devices
[edit] Corporate history Netflix was founded in 1997 in Scotts Valley, California by Marc Randolph,[36] and Reed Hastings , who previously had worked together at Pure Software, along with Mitch Lowe. Hastings was inspired to start the company after being hit with late fees for renting Apollo 13[37]. The Netflix website launched in April 1998 with an online version of a more traditional pay-per-rental model (US $4 per rental plus US $2 in postage; late fees applied).[38] Netflix introduced the monthly subscription concept in September, 1999,[39] then dropped the single-rental model in early 2000. Since that time the company has built its reputation on the business model of flat-fee unlimited rentals without due dates, late fees, shipping or handling fees, or per-title rental fees. Netflix developed and maintains an extensive personalized video-recommendation system based on ratings and reviews by its customers, similar to the system used by Amazon.com. The company believes this gives it an edge in competing with newcomers such as Blockbuster Video and Apple Inc. On October 1, 2006, Netflix offered a $1,000,000 prize to the first developer of a video-recommendation algorithm that could beat its existing algorithm, Cinematch, at predicting customer ratings by more than 10%.[40] "Some 35,000 different film titles are contained in the 1 million DVDs it sends out every day."[41] Netflix has played a prominent role in independent film distribution. Through a division called Red Envelope Entertainment, Netflix licenses and distributes independent films such as Born into Brothels and Sherrybaby. As of late 2006, Red Envelope Entertainment has also expanded into producing original content with filmmakers such as John Waters.[42] Netflix announced plans to close Red Envelope Entertainment in 2008, in part to avoid competition with its studio partners.[43][44] Netflix initiated an initial public offering (IPO) on May 29, 2002, selling 5,500,000 shares of common stock at the price of US $15.00 per share. On June 14, 2002, the company sold an additional 825,000 shares of common stock at the same price. After incurring substantial losses during its first few years, Netflix posted its first profit during fiscal year 2003, earning US $6.5 million profit on revenues of US $272 million. The company is well-known for its worker-oriented culture, including unlimited vacation time for salaried workers and allowing those employees to take any amount of their paychecks in stock options.[45] Netflix has been one of the most successful dot-com ventures. A New York Times article from September, 2002, said that, at the time, Netflix mailed about 190,000 discs per day to its 670,000 monthly subscribers. The company's published subscriber count increased from one million in the fourth quarter of 2002 to around 5.6 million at the end of the third quarter of 2006, to 10 million in February 2009. Netflix's growth has been fueled by the fast spread of DVD players in households; as of 2004, nearly two-thirds of U.S. homes had a DVD player. The DVD is the most successful product in the history of the U.S. in amount of growth measured by the number of units owned in individual U.S. homes. Impressively the DVD only took 5 years to reach 50% entrance into U.S. homes. Netflix capitalized on the success of the DVD and its rapid expansion into U.S. homes, integrating the potential of the Internet and e-commerce to provide services and catalogs that brick and mortar retailers could not compete with.[2] Netflix also operates an online affiliate program which has helped it to build online sales for DVD rentals. [edit] Competitive environmentSee also: Online DVD rental Netflix's success has inspired a number of other DVD rental companies both in the United States and abroad, but none of the purely online companies appear to approach Netflix in terms of market share or revenues. Wal-Mart began an online rental service in October 2002, but left the market in May 2005 and now has a cross-promotional arrangement with Netflix. Netflix has also cited Amazon.com as a potential competitor,[46] which until 2008 offered online video rentals in the UK and Germany (now sold to Lovefilm), but has remained coy about any similar intentions for the North American market. Netflix had preliminary plans to expand to Canada and the UK in 2005, but the expansion appears to have been postponed or canceled as Netflix concentrates its services on the U.S. market.[47] Zip.ca currently markets itself as a Canadian equivalent to Netflix. Posren and Tsutaya discas would be Japanese equivalents. Blockbuster Video, the world's largest in-store video rental chain, entered the U.S. online market in August 2004 with a US$19.95 monthly subscription service. This sparked a price war; Netflix had raised its popular three-disc plan from US$19.95 to US$21.99 just prior to Blockbuster's launch, but by October Netflix reduced this fee to US$17.99. Blockbuster responded with rates as low as US$14.99 for a time, but by August 2005, both companies settled at the (identical) current rates. On July 22, 2007, Netflix announced that it would drop the prices of its two most popular plans by US$1.00 in an effort to better compete with Blockbuster's online-only offerings.[48] Blockbuster's subscriber base after one year was roughly a third of Netflix's size and growing, including promotions such as the option to swap DVDs rented online at neighborhood stores and the simultaneous elimination of late fees altogether.[citation needed] Netflix founder Reed Hastings commented in a January 2005 interview that rival Blockbuster threw "everything but the kitchen sink at us."[49] Many in-store video rental chains now have unlimited rental plans similar to those of Netflix. Hollywood Video started its Movie Value Pass (MVP) service in late 2004, which enables customers to rent up to three movies at a time (due in five days) for US$15 a month. New releases, however, are typically excluded from the service for two to six weeks in the MVP "Basic" plan. Blockbuster started Movie Pass in 2004, which lets customers keep two to three DVDs at a time for US$25–30 a month, all without restrictions or due dates. Hollywood's MVP "Premium" plan offers the same benefits for a comparable price. Both services still require the customer to travel to the store to rent and return the movies, and their respective selections are not as diverse as that offered by Netflix. The domain netflix.com attracted at least 194 million visitors annually by 2008, according to a Compete.com survey. This is about five times the number of visitors to blockbuster.com.[50] On March 30, 2009 Netflix announced an increase in the monthly fee it would charge to customers who rent Blu-Ray discs. Customers were notified via email:
[edit] Netflix vs. BlockbusterOn April 4, 2006, Netflix filed a patent infringement lawsuit in which it demanded a jury trial in the United States District Court for the Northern District of California, alleging that Blockbuster's online DVD rental subscription program violated two patents held by Netflix. The first cause of action alleged Blockbuster's infringement of U.S. Patent No. 7,024,381 (issued April 4, 2006; only hours before the lawsuit was filed) by copying the "dynamic queue" of DVDs available for each customer, Netflix's method of using the ranked preferences in the queue to send DVDs to subscribers, and Netflix's method permitting the queue to be updated and reordered.[51] The second cause of action alleged infringement of Patent No. 6,584,450 (issued June 24, 2003), which covers in less detail the subscription rental service as well as Netflix's methods of communication and delivery.[52] The dispute was ended a year later, on June 25, 2007, with both companies declining to disclose the terms of their legal settlement, except for a statement by Blockbuster that it wouldn't have a major impact on its future financial performance.[53][54] Blockbuster also said that the company planned to close 282 stores that year to shift focus to its online service. The company already had closed 290 stores in 2006. In Fall 2006, Blockbuster signed a deal with The Weinstein Company, that gave it the exclusive rental rights to the studio's films beginning January 1, 2007.[55] This agreement forced Netflix to obtain copies from mass merchants or retailers, instead of directly from the studio.[56] Netflix has speculated that the effect of the Blockbuster-Weinstein agreement could result in higher rental costs and/or fewer copies of the studio's movies, which would limit the number of each movie's DVDs that would be available to subscribers at any one time.[57] As of June 2007, Netflix continues to make available Weinstein movies, including Unknown, School For Scoundrels and Harsh Times, among others. The first-sale doctrine allows Netflix and other video rental businesses to offer movies released by the Weinstein Company, but the long-term effects of the Blockbuster-Weinstein deal remain uncertain. [edit] "Throttling"Netflix's allocation policy — referred to by many as "throttling" — gives priority shipping and selection to customers who rent fewer discs per month. Higher volume renters may see some of their selections delayed, routed elsewhere or sent out of order.[58] Netflix currently claims that "the large majority of our subscribers are able to receive their movies in about one business day following our shipment of the requested movie from their local distribution center."[59] However, not all shipments come from the subscriber's local distribution center, and shipments from distant centers are often delayed, as well. [edit] Chavez v. Netflix Inc.In September 2004, a consumer class action lawsuit, Frank Chavez v. Netflix, Inc.,[60] was brought against Netflix in San Francisco Superior Court. The suit alleged false advertising in relation to claims of "unlimited rentals" with "one-day delivery." In January 2005, Netflix changed its "Terms of Use" to acknowledge what has commonly become known as "throttling." (Mike Kaltschnee, owner of the Hacking Netflix blog, says Netflix calls this practice "smoothing" internally.)[61] In October 2005, Netflix proposed a settlement for those who had enrolled as a paid Netflix member prior to January 15, 2005. These earlier members would be able to renew their subscriptions with a one-month free membership, and those early members with current subscriptions would receive a one-month free upgrade to the next-highest membership level. Netflix's settlement denied allegations of any wrongdoing, and the case did not reach a legal judgment. Netflix estimated the settlement cost at approximately US$4 million, which included up to US$2.53 million to cover plaintiff lawyer fees. A controversial aspect of the settlement offer was that the customer's account would continue at the renewed or upgraded membership level after the free month provided by the settlement, with customers being charged accordingly unless they opted out after the month-long free period ended. After Trial Lawyers for Public Justice filed a challenge to the proposed settlement[62] and the Federal Trade Commission filed an amicus brief urging the rejection or modification of the settlement, Netflix offered to alter the settlement terms requiring customers to actively approve any continuation after the free month. The final settlement hearing took place on March 22, 2006.[63] but, implementation of the settlement was delayed pending appeal the California Appellate Courts.[64] The settlement was affirmed on 2008-04-21, with the court saying, "the trial court did not abuse its discretion in approving the amended class action settlement agreement, approving the notice given to class members, or determining the amount of fees."[65] Interestingly, the court approved email notice and an online claims submission process.[66] The court said:
The settlement was criticized because it paid out $2.5 million to attorneys for fees and costs, while offering only coupons to the class members.[67][68] The Terms of Use have since been amended with terms that indicate such a suit would not be possible in the future:[69]
[edit] "Releasing This Week"The Netflix website at one time featured a list of titles "Releasing This Week" (RTW) that enabled customers to easily view new DVDs the company planned for rental release each week[70]. On December 21, 2007, the company removed the link to the page without notice and replaced it with a slider system showing only four previously released movies at a time. The new page, called "Popular New Releases", does not list newly released DVDs for rental.[71] The listing of new releases is still active,[72] though no menu option links to the page. On January 1, 2008, a Netflix employee unofficially stated on the Netflix Community Blog that customers used the RTW page to add newly released movies to the top of their queues, then complained about delays in receiving them after demand outstripped the supply of DVDs on hand. By removing the page, Netflix sought to quell complaints that these movies were not readily available. Critics, however, have suggested this was just another Netflix attempt at "throttling."[73] [edit] Joint Competition PromotionNetflix and Film Independent have announced jointly they want to discover the next great independent filmmaker. The Netflix FIND Your Voice Film Competition will award one aspiring filmmaker the "means, guidance and resources" to make a full-length, narrative film, plus a $150,000 cash production grant funded by Netflix. Film Independent will provide "advisement and mentorship" to the winning filmmaker throughout the production of the film and will also screen the winner’s movie at the Los Angeles Film Festival. The winner will own all rights to his or her film, which will be given distribution online at Netflix. As part of the grand prize, the winner will also receive a four-week camera package donated by Panavision, 25,000 feet of Kodak Color Negative Film or 10,000 feet of Kodak Color Intermediate Film donated by Eastman Kodak Company, up to $75,000 in dailies and prints donated by Deluxe Entertainment Services Group, and a digital intermediate package with a maximum value of $150,000 provided by EFILM Hollywood. First-time filmmakers who have not yet created and publicly screened a full-length narrative feature film of 70 minutes or more are eligible. There is no fee to apply to the competition, but a maximum of only 2,000 submissions will be accepted. The winner of “Netflix FIND Your Voice Competition” will be selected from among the five finalists by a panel of judges consisting of independent film professionals, chaired by Josh Brolin. [1] [edit] Netflix APIOn October 1 2008, Netflix launched an Application Programming Interface (API) [74]. The Netflix API [75] allows access to data for all Netflix titles as well as access on a user's behalf to manage their movie queue. The Developer Network includes a forum for asking and answering questions. The Netflix API is free and allows commercial use. A variety of services have been created around the Netflix API or have integrated the API. Examples include Rotten Tomatoes and the New York Times, which allow users to click to add titles to their Netflix queue or begin watching on Watch Instantly from their pages,[76] and Jinni, which additionally enables search within Watch Instantly and import of some user information like reviews.[77] The API has allowed many developers to release Netflix applications for mobile devices including one for the Android platform. Netflix also recently announced an official Nokia app that allows some trailer streaming. [edit] References
[edit] External links This audio file was created from a revision dated 2006-01-26, and does not reflect subsequent edits to the article. (Audio help)
| |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| ↑ top of page ↑ | about thumbshots |
