Reed Hastings founded Netflix with the prospect of Service home movies that have done better satisfy customers than traditional retail rental model. But, as he called on the problems that it has undergone some major changes strategy, ultimately, the development of business models and operational strategies that have been very damaging to the video rental retailers. The combination of a large national inventory recommendation system that drove the audience on a wide directory and a large client base made Netflix a force to be reckoned with, especially as a distribution channel for the lower profile and independent films. Blockbuster, the country's largest retail video rental company, initially slow to respond, but eventually rolled out a hybrid retail / online response in the form of on-line Blockbuster. Aggressive pricing pulled in subscribers, but for the price, as is Netflix. But a new challenge on the horizon: a video-on-demand. Netflix how to react? "Hide
by Willy Shih, Stephen P. Kaufman, David Spinola Source: HBS Premier Case Collection 15 pages. Publication Date: May 31, 2007. Prod. #: 607138-PDF-ENG
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