Technology

Netflix, the new way of watching

Reed Hastings, CEO of Netflix, it seems like it all started with a late movie and a huge late-return fee. Netflix was as simple as mailing movies to people and paying a flat rate regardless of how long the movie was – that is, no late fees. This simple model has transformed the way we watch movies.

People no longer just get movies by mail at home; they are now watching movies that are streamed directly to their mobile device, tablet or TV. According to recent data from Sandvine, 20 percent of US primetime non-mobile internet usage is from Netflix instant movies. Netflix started streaming movies in 2007, with many technical problems. However, with technological advances and the increase in broadband in homes it has become their main service with the benefit of receiving movies by mail as an additional service. Netflix has affected the industry and added a new dimension to cloud computing and internet-based products.

Netflix does not have an easy road ahead. Comcast, Hulu, Amazon, Verizon, and to some extent YouTube are all coming for that movie streaming business. And some of these companies have more ammo than others. Comcast has begun charging for Level 3, Netflix’s back-end help to provide the mechanism for movies to be streamed, per “movie” sent through their system to their customers. This doesn’t affect the end user as much as Netflix and Level 3.

What started out as a good idea has transformed the way Americans watch movies. Netflix and Hastings have learned to stay ahead. They are willing to pay for the best and that allows them to stay ahead and set the pace.

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