This is a great story of recognizing changing times and adapting your business. A traditional media company that has successfully transitioned to a new digital media company. While at the same time killing their competition, Blockbuster. They should offer classes to the music industry.
Netflix now considers itself a “streaming company which also offers DVDs by mail,” according to CEO Reed Hastings in the management commentary that accompanies its third-quarter earnings release. According to Netflix, the company now spends more money on streaming content than on DVDs, and as a result consumers now stream more videos than they watch on DVD.
In the commentary, Hastings is quoted as saying:
We are very proud to announce that by every measure we are now a streaming company, which also offers DVD-by-mail. In Q4, we’ll spend more on streaming content than DVD content, and we’ll deliver many more hours of entertainment via streaming than on DVD. More impressively, a majority of our subs will watch more content streamed from Netflix than delivered by us on DVD. DVD-by-mail shipments are still growing, but streaming for us is much larger and growing much faster.
More subscribers are streaming more content than ever before, according to Netflix. It added 1.9 million new subscribers in the quarter, bringing its total subscriber count to 16.9 million, which is up 52 percent over the previous year’s third quarter. And two-thirds of its subscribers now stream content, which is up from 41 percent a year earlier and 61 percent in the second quarter.
The manager at Blockbuster asked me the other day why I no longer spend an insane amount on rentals like I used to. The simple answer was evolution. They are just not relevant anymore. Kudos to Netflix. Moreso now that they’ve finally come to Canada!
The fact a Blockbuster manager had to even ask why you spend money is exactly why they are in the situation they are… blind and ignoring change. They must have studied under the music industry.
Awesome. Now let’s get the streams to 1080p and not screw up the aspect ratio. (Or maybe that’s just my Roku box.)