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Netflix, Inc. Message Board

  • kartesian2000 kartesian2000 Jun 17, 2003 2:25 PM Flag

    The REAL power of NFLX....

    to the studios and other producers of this type of "software" is that only 30% of NFLX unit out on rental are new releases...through their software they are creating demand for a huge part of the franchise value of these studios..namely their libraries...while these studios have tried many ways to "mine" this asset it has not been hugely successful...NFLX changes ALL of many of you rent and view movies that you never would have seen if the big box retailers (BBI, WMT etc)were the only distribution channel. The software in the system creates demand for these libraries...this creates a revenue and profit stream that otherwise didn't exist...The major studios make 450 movies a year (the industry makes 2000 and how many of those do Jane and Joe Blow see...10, 15, 20? Go into a releases are on the outer walls...that is where all the customers largely congregate...the old titles are in the middle and they are very limited. As they migrate this "library" to DVD they are continuing to prune old title availability further exacerbating the issue. In my judgment, this is the power and attraction to NFLX for the consumer and the studio and NO ONE is competing with us on this front.

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