What is the Netflix business model?

Discussion in 'Community Discussion' started by MacBH928, Jan 13, 2016.

  1. MacBH928 macrumors 68020

    MacBH928

    Joined:
    May 17, 2008
    #1
    I still can't believe that Netflix offers you unlimited watching for a full months for $10 only. Compare that to buying 1 DVD will cost you $20.

    Do they split my $10 equally between content providers, or do they split it based on minutes? So if I watch say Breaking bad for 10 min and then switched it off AMC will only get paid for that 10min?
     
  2. rocknblogger macrumors 68020

    rocknblogger

    Joined:
    Apr 2, 2011
    Location:
    New Jersey
    #2
    I don't think that's how it works. I think they pay a flat fee for the license to a certain package of titles and it doesn't matter how much any one title is watched or not.
     
  3. Huntn macrumors G5

    Huntn

    Joined:
    May 5, 2008
    Location:
    The Misty Mountains
    #3
    They offer a subscription service whether you are renting physical CDs or streaming. They purchase a license to offer the content, it could be a royalty, purchase, or purchase plus royalty. The content sits on their servers, or on physical disks, which is rented.

    See: http://www.fool.com/investing/general/2015/01/31/how-does-netflix-work.aspx

    Think of all the local franchises and brick and mortar stores that have gone belly up betting on physical media. I still prefer physical media for purchase, because I'm not beholding to a particular company and I don't need a connection to view it.
     
  4. MacBH928 thread starter macrumors 68020

    MacBH928

    Joined:
    May 17, 2008
    #4
    So it doesn't matter how many times I watch a movie or a show, the original content provider does not benefit any more or less? I thought thats how streaming services work. At least thats how I heard Apple Music and Spotify work, for every played song they get like $0.05 or something like that.

    I am surprised movie makers agreed to this model.

    As for buying physical, a full years of unlimited Netflix is the equivalent of buying 5-7 DVDs which you can be done with in a week or 2. Buying physical doesnt sound too tempting.
     
  5. Apple fanboy macrumors Core

    Apple fanboy

    Joined:
    Feb 21, 2012
    Location:
    Behind the Lens, UK
    #5
    But sometimes it's nice to own your content. If Netflix were to lose the rights to your favourite titles you can't watch them.
    Or if your wifi goes belly up for the evening.
    I think buy some, stream others is the way forward.
     
  6. twietee macrumors 603

    twietee

    Joined:
    Jan 24, 2012
    #6
    Also, you still have an extremely limited choice in the first place.
     
  7. Huntn macrumors G5

    Huntn

    Joined:
    May 5, 2008
    Location:
    The Misty Mountains
    #7
    About your first comment, I don't know. I don't believe Netflix has an ownership aspect like iTunes or Amazon. Once those are attached to your account via the latter options, you "own" them at least until those companies go belly up. And for physical media, I only buy movies I dream worthy. Everything else I stream.
     
  8. Zenithal Suspended

    Joined:
    Sep 10, 2009
    #8
    Flat fee. I asked support once when I first became a member. Between it and being a Prime member, I don't think I've had the need to rent or purchase a DVD/Blu-Ray in years. Though it would be worthwhile for Amazon to start a DVD and or Blu-Ray rental service.
     

Share This Page