There will be significant progress made towards a new business model beyond the

There will be significant progress made towards a new

This preview shows page 13 - 16 out of 19 pages.

There will be significant progress made towards a new business model beyond the traditional ad-supported and subscription service ones. Normally American household spends, on average, nearly five hours per day watching video content and it is a very effective medium for generating product interest. Online streaming has the opportunity to revolutionize the way products accompany content, and are ultimately introduced to viewers. According to analyst Ken Gao, “The opportunities are boundless when one thinks of how awesome an experience it would be if we can realize the full potential of combining streaming video and e-commerce – a next generation Home Shopping Network Netflix must provide easy access to all of their movie selections through the use of search engines or categories to help the user search for any movie. As for this strategy made the company become number one, driving popularity of streaming services . Accessibility and convenience has reached a new level . Significant progress made towards a new business model beyond. Discussion Questions Page 13 of 19
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1. Did Netflix implement too quickly – due to the high growth and fast expansion Is there such thing as that a company grown too fast and toot? How a company can become a victim of its own success? The world s largest subscription - streaming service had 50 . 1 million subscribers . However, user growth cannot continue indefinitely as the company saturates the market. In Sep14, Netflix s oversized ambitions and hasty moves could derail the streaming giant even further . The company made its biggest international expansion . Netflix s rollout into six European countries. The company will faced major challenges: different viewer tastes across markets, competition from both domestic and American streaming services, conflicts over rights to popular, and pay - tv providers, such as Canal Plus, AG, Amazon and HBO . The company also faces laws that could require it to finance and promote locally produced programming, especially in France . In Australia, Netflix may also be forced by local rights holders to block illegal access This expansion issue bounded with the startup costs of entering new markets, including compliance with local laws and requirements, which could depress Netflix s growth for several years to come and disappoint investors who have come to expect stratospheric growth from the company . The international segment of Netflix suffered a loss in 2013 even before it decided to expand to European market, which the company will have more burden to support its significant marketing, legal, technical, and administrative expenditures to create market share . Moreover the company announced that it will enter film production. This action will double it spending . Unlike television, movie costs heavily dependent for marketing success on expensive Page 14 of 19
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star appeal and costly visuals . This make movies a very risky proposition that takes Netflix away from its core competency
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