HOW NETFLIX MAKES MONEY? TO BECOME A 20 BILLION DOLLAR COMPANY

Netflix make money

NETFLIX - The Entertainment Company

How Netflix makes money? – Netflix is an American service provider and production company headquarters based California founded in 1997 by Reed Randolph and Marc Randolph.

Netflix makes money through subscription-based streaming service which offers online streaming of films and television series. Started in 1997, Netflix had no revenue till 2003 until 2007 it started streaming movies online. Reed and Marc did not stop there, Netflix started their original series such as Sacred Games, Marco Polo, House of Cards, Orange is the new black and now The Irishman.

Netflix is now a 20 Billion dollar company established its customers spread across 170 countries. Reed once in the interview mentioned that ‘ THE BIGGEST COMPETITOR OF NETFLIX IS SLEEP ‘.

HOW NETFLIX MAKES MONEY?

How NETFLIX MAKES MONEY

WHAT MADE NETFLIX GROW SO BIG

We love entertainment because we all get bored. People love watching movies with families, during travel or maybe when they are alone. Netflix took this opportunity to give people control for their entertainment. Before Netflix, entertainment was in hands of the television industry. 

Not only did Netflix gave varieties of movies and series for entertainment, they also brought start and stop feature to resume movie as per our schedule. 

Again the most amazing feature I love in Netflix is you can download the movies in app and watch it when you are travelling or in area with no internet connectivity. I love Netflix because it is helping creators and actors to reach the customers any where and at any time at very low cost. 

But Netflix is also spending billions depending on the movies. As mentioned Netflix created its original series which adds up the huge cost for production. By creating great content and Netflix original movies and series they are trying to create monopoly by which customer can watch originals on Netflix only.

Other than above many customer love Netflix due to a variety of  content available without any filters. Customer can even skip to next episode or return to previous.

Pandemic crisis has no impact on Netflix but instead, it had boosted the subscribers and revenue as more and more people will stay at home. Lock down impact on theatres and film industry will continue at least for next six months. But Netflix will not stop due to their digitization platform.

WHY NETFLIX is so focused on INDIA

Netflix makes money from subscribers. More subscribers mean more revenue. Reed said we are very much excited to spread in India because of its population. With more than 1 Billion population and entertainment lover, India is the main market for Netflix.

The only hurdle Netflix faces in India is the internet connectivity. But since JIO came up with the massive broadband speed and low plan offer it will definitely help  Netflix to reach its customers.

Source: Regulatory filings indicate that the video-streaming giant’s total income in the country surged 8X in 2018-19 to reach Rs 470 crore, up from Rs 58 crore the year ago. Net profits increased to Rs 5.15 crore from a mere Rs 20 lakh in 2017-18 – more than a 25X rise.

Competition For Netflix

DISNEY TV 

Netflix is the biggest platform for streaming movies and TV series but Disney TV is the giant. Disney is 80 billion in revenue while Netflix is 20 billion. Reed says that they are learning from Disney and there is no way we can compete with Disney. Disney is 4 times bigger than Netflix and creates most creative content. Netflix is learning from Disney and appreciate their creativity.

YOUTUBE

YouTube do not have movies and series which Netflix offer, but they do have short entertaining videos like prank, experiment and courses. The most amazing thing about YouTube is its free. YouTube is big competitor of Netflix but both are different market and not comparable.

ILLEGITIMATE SITES

Sites like fmovies and Bmovies are the site which offer free movies and series just like Netflix and Amazon prime. This is great threat to Netflix as many people love free content.

Few people who are fans of movies pay and watch it. if you really like their movies, you should pay to watch them. But these days, the web makes paying optional. Sure, the Internet helps studios share their works globally with a few mouse clicks. Yet it also enables digital pirates to spread copyrighted content all over the place, and none of that revenue is pocketed by the creators.

THEATRES.

Reed in an interview to The New York Times said that Theatres are not our competition. He too love to go to theatres frequently as it is great for groups and enjoyment. When some one feels to watch movies in theatres they will do it. Only benefit Netflix has over theatre is they cannot show TV series as Netflix does. Besides we can see how pandemic had a negative impact on theatre industry.

Also Netflix enjoy the no filter for nudity while theatres need to comply with Central Board of Film Certification (CBFC) is a statutory film with certification rules.

SHOW TIME and AMAZON PRIME

Show Time and Amazon have their variety to offer to customer. It depends on the creative content and taste of customers. Netflix has Marvels series like Daredevil and Punisher which is hit show. While show time hit shows are Billion and Ray Donovan.

IS NETFLIX BUSINESS MODEL SUSTAINABLE?

Netflix focus on creative content which can be seen through their original series. Data is new oil. People love entertainment. Mobile and Internet has complete control on the human life and behavior. 

Netflix is not only the player in market but the creativity, art and entertaining company will lead the market. Netflix is focused on age group from 13- 35 age. Above 35 people still love watching television. Netflix is running the entertainment market for two decades and will do so on by its creative content.

WHAT DO YOU LOVE ABOUT NETFLIX ? PLEASE COMMENT BELOW. 

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