Exam 4: Netflix in Two Acts: the Making of an E-Commerce Giant and the Uncertain Future of Atoms to Bits

Netflix enjoys the triple scale advantage of the largest customer base, the largest selection, and the largest network of distribution centers. This can be attributed to:

Netflix has used the long tail in the DVD-by-mail business to its advantage, crafting a business model that creates close ties with film studios. What do film studios stand to gain from taking advantage of the Netflix model targeted at increasing the firm's long-tail offerings?

The practice of windowing involves:

Netflix offered its subscribers a selection of over one hundred thousand DVD-by-mail titles, while other video rental firms can only offer as much as three thousand. This presents a significant _____ for Netflix over its rivals.

The high degree of customer satisfaction that Netflix enjoyed is tightly linked with the firm's sized-based advantages.

For traditional retailers selling physical goods, _____ is the biggest constraint limiting a firm's ability to offer customers what they want and when they want it.

Over ___percent of new Netflix customers coming from outside the United States.

The business of streaming video is radically different from DVD-by-mail in several key ways, including content costs, content availability, revenue opportunities, rivals and their motivation.

Explain the long tail phenomenon at Netflix.

The yearly cost to run a Netflix-comparable nationwide delivery infrastructure is about $300 million.

Today the Netflix is so focused on _____________ that it offers its streaming-only subscription as the default option for consumers.

Original content is an investment in allowing a firm to provide differentiated goods, a way to entice and retain customers with exclusive programming not available anywhere else.

How does Cinematch offer Netflix additional operational advantages for the DVD-by-mail business?

Why is bargaining power shifting to content providers as the video content industry shifts from atoms to bits?

A manager's decision making is often shaped by its perception of the competition. Which of the following does Netflix see as being in competition with the firm?

The long tail is a phenomenon whereby firms can make money by:

How does Netflix leverage its data asset, even as it has shifted from atoms to bits?

___________ refers to the rate at which customers leave a product or service

While the size of the tail in the long tail phenomenon is disputable, one fact that is critical to remain above this debate is that:

Even though Netflix is now mainly focused on digital distribution, it continues to offer the DVD-by-mail service in its base-price product.