Netflix Inc. Essay -- essays research papers

Netflix Inc.Company BackgroundNetflix Inc. incorporated in 1997 and make its first public offering in 2002. Netflix is an online moving-picture repoint rental usefulness which provides its 3,000,000 subscribers access to over 40,000 DVD titles. Although Netflix stocks nearly every title obtainable on DVD, it does not stock titles containing adult content. The Netflix program al economic crisiss subscribers to rent as many DVDs as they want, and keep them for as yearn as they want. Three DVDs can be show up at a time, as soon as one is returned the following DVD on the subscriber generated movie list is shipped out. The DVDs atomic number 18 delivered for free by the United States Postal Service from regional distribution centers located throughout the United States. Netflix can have most(prenominal) titles delivered to 90% of its subscribers within one business day of the shipping date. The accompany provides a personalized movie recommendation service that creates customiz ed recommendations for the subscriber. This system is ground on customer rental history and the ratings the customers provide to Netflix. The ratings system is a simple 5 star system where 1 star is commensurate to a bad movie and 5 stars is equal to an excellent movie. Netflix excessively provides decision making in formation to the subscriber about each movie the company provides. This information includes the length, rating, cast and crew, special features, screen formats, and plot synopses. Netflix in addition provides movie reviews written by Netflix editors, subscribers, and movie critics. In addition Netflix provides the fair rating that other subscribers gave the title, and displays other titles that the subscriber might enjoy.Netflix has revenue share agreements with more than 67 studios and distributors, and also purchases titles directly from studios, distributors, and independent producers. The major competitors for Netflix are Movie Gallery, Trans World Entertainm ent, Blockbuster, and Intermix Media.Industry TrendsSince 1999 the egression of expense on DVD purchases and rentals has been incredible. According to Alexander & Associates, Rapidly growing consumer activity and spending has built this industry into a major market phenomenon. The DVD format for enjoying pre-recorded entertainment at home is extraordinarily popular and consumers are ever-changing their behavior to accommodate it.The VHS market totaled nearly $20 billion... ...ble debt watchfulness by having the ability to pay its interest obligations easily. All four of these ratios show us that Netflix is in a good position to service both(prenominal) their long and short term debt obligations, and that they have kept their debt load low and under control.We have found that the gross, operating, and net profit margins are screening us that the company is beginning to post some gains and are up(p) their profitability. In addition the ROI has increase nearly 4% and the ROE has increased 7%. We see this as a responsible rate of growth which allows sales and sales revenues to keep mistreat with the growth of the company. By autocratic their growth Netflix has been able to expand its operations and control their debt.RecommendationsAlthough Netflix has been extremely economical about the way they are controlling their debt load we believe that they may be missing some opportunities to expand their services. Netflix could possibly free up some cash to explore the market opportunities for service to the video bet on enthusiast. Other than that we really think that if Netflix keeps improving at the steady pace its going, the company will have a bright future.