Back in 1997, Netflix was a little known company out of California delivering DVD’s in the mail. This was simply unheard of especially during a time that video stores like Blockbuster and Hollywood Video dominated the video rental markets with thousands of brick and mortar stores. It seemed like there was no chance that Netflix would even make a dent when people were so accustomed to going to the video stores for their Movie fixes. Blockbuster was especially bullish on their current model dismissing Netflix as a real competitive threat due to their sheer dominance of the industry. But fast forward years later, Hollywood Video went bankrupt in 2010 and Blockbuster filed for bankruptcy in 2013 later being acquired by Dish Network.
Netflix saw convenience as the future and with our current Internet world of instant entertainment, they were right. Now we’re in an age where Netflix is the online entertainment behemoth while countless others, including juggernauts like Amazon, Apple, and Google, are constantly in a never ending battle to dethrone the King. What has emerged is something called the “Netflix Effect.” Not only has the company changed the way we get our entertainment, but they’ve also dramatically changed our viewing habits as well. With the Internet, people are used to getting their entertainment on their own terms without waiting or interruptions like commercials. People have also been accustomed to pay for streaming services like Netflix over Cable companies – aka “Cord Cutting.”
Another huge shift in viewing habits is the addictive nature of Binge Watching-which I believe is the true power of the Netflix Effect. This is especially true for episodic shows where Netflix provides an entire season upfront without the need to wait for the next week to see upcoming episodes. By doing this, Netflix has effectively kept people watching for thousands of hours no matter where they’re at as long as they have an Internet connection and the Netflix service is provided in that country. This is truly the advantage that Netflix has over their competitors. And by producing Netflix only content, they’re able to cut out other production studios while maintaining all the control and profits.
Other competitors like Amazon, Hulu and even YouTube are starting to produce their own exclusive content to mimic this Netflix Effect. All these efforts are meant to keep people’s eyeballs and most importantly, money on these entertainment platforms. Now as both a content creator and consumer, I can see the benefits and pitfalls of this Netflix Effect model. Whatever the case might be, convenience is something that people will always value even if it means wasting an entire weekend binging on your favorite shows.