From Wikipedia the free encyclopedia
|Type of business||Public|
Type of site
|OTT streaming platform|
|Founded||August 29, 1997 in Scotts Valley, California, U.S.|
|Headquarters||Los Gatos, California, U.S.|
|Area served||Worldwide (excluding Mainland China, Crimea, North Korea and Syria)|
|Industry||Technology & Entertainment industry, mass media|
|Revenue||US$25 billion (2020)|
|Operating income||US$4.585 billion (2020)|
|Net income||US$2.761 billion (2020)|
|Total assets||US$39.28 billion (2020)|
|Total equity||US$11.065 billion (2020)|
|Users||209 million (paid; as of July 20, 2021[update])|
Netflix, Inc. is an American pay television over-the-top media service and original programming production company. It offers subscription-based video on demand from a library of films and television series, 40% of which is Netflix original programming produced in-house. Netflix has also played a prominent role in independent film distribution. As of July 2021, Netflix has 209 million subscribers, including 72 million in the United States and Canada. It is available worldwide except in mainland China (due to local restrictions), Syria, North Korea, and Crimea (due to US sanctions). Netflix is a member of the Motion Picture Association (MPA).
Netflix was founded in 1997 by Reed Hastings and Marc Randolph in Scotts Valley, California. Netflix initially both sold and rented DVDs by mail, but the sales were eliminated within a year to focus on the DVD rental business. In 2007, Netflix introduced streaming media/video on demand. The company expanded to Canada in 2010, followed by Latin America and the Caribbean. Netflix entered the content-production industry in 2013, debuting its first series House of Cards. In January 2016, it expanded to an additional 130 countries and then operated in 190 countries.
The company is ranked 164th on the Fortune 500 and 284th on the Forbes Global 2000. It is the largest entertainment/media company by market capitalization. In 2021, Netflix was ranked as the 8th most trusted brand globally by Morning Consult. During the 2010s decade, Netflix was the top-performing stock in the S&P 500 stock market index, with a total return of 3,693%.
Netflix is headquartered in Los Gatos, California, in Santa Clara County, with the two CEOs, Hastings and Ted Sarandos, split between Los Gatos and Los Angeles, respectively. The company is seen as part of the Silicon Valley high-tech world. It also operates international offices in Asia, Europe, and Latin America including in Canada, France, Brazil, the Netherlands, India, Japan, South Korea, and the United Kingdom. The company has production hubs in Los Angeles, Albuquerque, London, Madrid, Vancouver and Toronto.
Launch as a mail-based rental business (1997–2006)
On August 29, 1997, Marc Randolph and Reed Hastings founded Netflix in Scotts Valley, California. Hastings, a computer scientist and mathematician, was a co-founder of Pure Atria, which was acquired by Rational Software Corporation in 1997 for $700 million, then the biggest acquisition in Silicon Valley history. Randolph had worked as a marketing director for Pure Atria after Pure Atria acquired a company where Randolph worked. He was previously a co-founder of MicroWarehouse, a computer mail-order company as well as vice president of marketing for Borland International. Hastings and Randolph came up with the idea for Netflix while carpooling between their homes in Santa Cruz, California and Pure Atria's headquarters in Sunnyvale. Patty McCord, later head of human resources at Netflix, was also in the carpool group. Randolph admired Amazon.com and wanted to find a large category of portable items to sell over the Internet using a similar model. Hastings and Randolph considered and rejected selling and renting VHS tapes as too expensive to stock and too delicate to ship. When they heard about DVDs, first introduced in the United States on March 24, 1997, they tested the concept of selling or renting DVDs by mail by mailing a compact disc to Hastings's house in Santa Cruz. When the disc arrived intact, they decided to enter the $16 billion home-video sales and rental industry. Hastings is often quoted saying that he decided to start Netflix after being fined $40 at a Blockbuster store for being late to return a copy of Apollo 13, but he and Randolph designed this apocryphal story to explain the company's business model and motivation. Hastings invested $2.5 million in cash from the proceeds of the Pure Atria sale into Netflix. Netflix launched as the world's first online DVD-rental store, with only 30 employees and 925 titles available—almost the entire catalogue of DVDs at the time.
Initially, Netflix offered a per-rental model for each DVD, but introduced a monthly subscription concept in September 1999. The per-rental model was dropped by early 2000, allowing the company to focus on the business model of flat-fee unlimited rentals without due dates, late fees, shipping and handling fees, or per-title rental fees.
In 1998, Randolph and Hastings met with Jeff Bezos, where Amazon.com offered to acquire Netflix for between $14 and $16 million. Fearing competition from Amazon, Randolph at first thought the offer was fair but Hastings, who held a major 70% of the company, turned it down on the plane ride home. In September 2000, during the dot-com bubble, while Netflix was suffering losses, Hastings and Randolph offered to sell the company to Blockbuster LLC for $50 million. John Antioco, CEO of Blockbuster, thought the offer was a joke and declined, saying "The dot-com hysteria is completely overblown". While Netflix experienced fast growth in early 2001, the continued effects of the dot-com bubble collapse and the September 11 attacks caused the company to hold off plans for its initial public offering (IPO) and to lay off one-third of its 120 employees.
DVD players were a popular gift for holiday sales in late 2001, and demand for DVD subscription services were "growing like crazy", according to chief talent officer Patty McCord. The company became a public company on May 29, 2002, selling 5.5 million shares of common stock at US$15.00 per share. Netflix posted its first profit in 2003, earning $6.5 million on revenues of $272 million; by 2004, profit had increased to $49 million on over $500 million in revenues. In 2005, 35,000 different films were available, and Netflix shipped 1 million DVDs out every day.
Randolph stepped down as CEO in 1999 and left the company in 2003 to mentor other startups.
In 2004, Blockbuster introduced a DVD rental service, which not only allowed users to check out titles through online sites, but allowed for them to return them at brick-and-mortar stores. By 2006, Blockbuster's service reached two million users, and while trailing Netflix's subscriber count, was drawing business away from Netflix. Netflix lowered fees in 2007. While it was an urban legend that Netflix ultimately "killed" Blockbuster in the DVD rental market, Blockbuster's debt load and internal disagreements hurt the company.
In September 2004, Netflix was sued for false advertising in relation to claims of "unlimited rentals" with "one-day delivery". The suit was settled in November 2005, with Netflix offering a free month of service or upgrade.
On October 1, 2006, Netflix announced the Netflix Prize, $1,000,000 to the first developer of a video-recommendation algorithm that could beat its existing algorithm Cinematch, at predicting customer ratings by more than 10%. On September 21, 2009, it awarded the $1,000,000 prize to team "BellKor’s Pragmatic Chaos". Cinematch, launched in 2000, is a recommendation system that recommended movies to its users, many of which they might not ever had heard of before.
Through its division Red Envelope Entertainment, Netflix licensed and distributed independent films such as Born into Brothels and Sherrybaby. In late 2006, Red Envelope Entertainment also expanded into producing original content with filmmakers such as John Waters. Netflix closed Red Envelope Entertainment in 2008, in part to avoid competition with its studio partners.
Transition to streaming services (2007–2012)
In January 2007, the company launched a streaming media service, introducing video on demand via the Internet. However, at that time it only had 1,000 films available for streaming, compared to 100,000 available on DVD. The company had for some time, considered offering movies online, but it was only in the mid-2000s that data speeds and bandwidth costs had improved sufficiently to allow customers to download movies from the net. The original idea was a "Netflix box" that could download movies overnight, and be ready to watch the next day. By 2005, Netflix had acquired movie rights and designed the box and service. But after witnessing how popular streaming services such as YouTube were despite lack of high-definition content, the concept of using a hardware device was scrapped and replaced with a streaming concept.
In April 2007, Netflix recruited Anthony Wood, one of the early DVR business pioneers, to build a "Netflix Player" that would allow streaming content to be played directly on a television set rather than a PC or laptop. While the player was initially developed at Netflix, Reed Hastings eventually shut down the project to help encourage other hardware manufacturers to include built-in Netflix support. Wood quit Netflix and founded Roku, Inc. to launch the player, making him a billionaire. Netflix invested $6 million in Roku.
In January 2008, all rental-disc subscribers became entitled to unlimited streaming at no additional cost (however, subscribers on the restricted plan of two DVDs per month ($4.99) remained limited to two hours of streaming per month). This change came in a response to the introduction of Hulu and to Apple's new video-rental services.
In June 2008, Netflix announced plans to eliminate its online subscriber profile feature, which allowed one account to contain multiple users; however, after customer complaints, Netflix reversed its decision.
In August 2008, the Netflix database was corrupted and the company was not able to ship DVDs to customers for 3 days, leading the company to move all its data to the Amazon Web Services cloud, which was completed in January 2016.
In 2009, Netflix streams overtook DVD shipments.
On January 6, 2010, Netflix agreed with Warner Bros. to delay new release rentals 28 days prior to retail, in an attempt to help studios sell physical copies, and similar deals involving Universal Pictures and 20th Century Fox were reached on April 9.
In August 2010, Netflix reached a five-year deal worth nearly $1 billion to stream films from Paramount, Lionsgate and Metro-Goldwyn-Mayer. The deal increased Netflix's annual spending fees, adding roughly $200 million per year. It spent $117 million in the first six months of 2010 on streaming, up from $31 million in 2009.
In November 2010, Netflix began offering a standalone streaming service separate from DVD rentals.
In 2010, Netflix acquired the rights to Breaking Bad, produced by Sony Pictures Television, after the show's third season, at a point where original broadcaster AMC had expressed the possibility of cancelling the show. Sony pushed Netflix to release Breaking Bad in time for the fourth season, which as a result, greatly expanded the show's audience on AMC due to new viewers binging on the Netflix past episodes, and doubling the viewership by the time of the fifth season. Breaking Bad is considered the first such show to have this "Netflix effect".
In March 2011, Netflix began acquiring original content for its library, beginning with the hour-long political drama House of Cards, which debuted in February 2013. The series was produced by David Fincher, and starred Kevin Spacey.
As of March 28, 2011, Netflix had 58 DVD shipping locations throughout the United States.
In May 2011, streaming media continued to gain market share over DVDs.
On July 12, 2011, Netflix announced that it would separate its existing subscription plans into two separate plans: one covering the streaming and the other DVD rental services. Charging customers for its mail rental service and streaming service separately meant a price increase for customers who wanted to continue receiving both services. The cost for streaming would be $7.99 per month, while DVD rental would start at the same price. The announcement led to panned reception among Netflix's Facebook followers. Twitter comments spiked a negative "Dear Netflix" trend.
On September 1, 2011, Starz ceased renewal talks with Netflix. As a result, Starz's library of films and series were removed from Netflix on February 28, 2012. Titles available on DVD were not affected and can still be acquired from Netflix via its DVD-by-mail service. However, select films broadcast on Starz continue to be available on Netflix under license from their respective television distributors.
On September 18, 2011, Netflix announced its intentions to rebrand and restructure its DVD home media rental service as an independent subsidiary called Qwikster, separating DVD rental and streaming services. Andy Rendich, a 12-year Netflix veteran, was to be CEO of Qwikster. Qwikster would carry video games whereas Netflix did not. It was also announced that the re-branded service would add video game rentals. The decision to split the services was widely criticized; it was noted that the two websites would have been autonomous from each other (with ratings, reviews, and queues not carrying over between them), and would have required separate user accounts. Also, the two websites would require separate subscriptions.
However, on October 10, 2011, in a reversal, Netflix announced that it would retain its DVD service under the name Netflix and would not, in fact, create Qwikster for that purpose. Netflix announced that its streaming and DVD-rental plans would remain branded together. Netflix announced that the reversal was in response to customer feedback, and that the DVD-by-mail and streaming services would continue to operate through a single website under the Netflix brand. Netflix lost 800,000 subscribers in the fourth quarter of 2011—a loss partially credited to the poor reception of the aborted re-branding.
In April 2012, Netflix filed with the Federal Election Commission (FEC) to form a political action committee (PAC) called FLIXPAC. Politico referred to the PAC, based in Los Gatos, California, as "another political tool with which to aggressively press a pro-intellectual property, anti-video-piracy agenda". The hacktivist group Anonymous called for a boycott of Netflix following the news. Netflix spokesperson Joris Evers indicated that the PAC was not set up to support the Stop Online Piracy Act (SOPA) and the PROTECT IP Act (PIPA), tweeting that the intent was to "engage on issues like net neutrality, bandwidth caps, UBB and VPPA".
In July 2012, Netflix hired Kelly Bennett, former Warner Bros. Vice President of Interactive, Worldwide Marketing, to become its chief marketing officer. This also filled a vacancy at Netflix that had been empty for over six months when previous CMO Leslie Kilgore left in January 2012.
In September 2012, Epix signed a five-year streaming deal with Netflix. For the initial two years of this agreement, first-run and back-catalog content from Epix was exclusive to Netflix. Epix films came to Netflix 90 days after premiering on Epix. However, the exclusivity clause ended on September 4, 2012, when Amazon signed a deal with Epix to distribute its titles via the Amazon Prime Video streaming service. These include films from Paramount, Metro-Goldwyn-Mayer and Lionsgate.
On December 4, 2012, Netflix and Disney announced an exclusive multi-year agreement for first-run United States subscription television rights to Walt Disney Studios' animated and live-action films, with classics such as Dumbo, Alice in Wonderland and Pocahontas available immediately and others available on Netflix beginning in 2016. Direct-to-video releases were made available in 2013. The agreement with Disney ended in 2019 due to the launch of Disney+. Netflix retains the rights to continue streaming the Marvel series that were produced for the service. Netflix will retain worldwide streaming rights to Two Lovers and a Bear and The Woman in the Window as Fox and Netflix jointly acquired the US distribution rights to Two Lovers and a Bear, and Netflix acquired worldwide distribution rights to The Woman in the Window from 20th Century Studios.
On January 14, 2013, Netflix signed an agreement with Time Warner's Turner Broadcasting System and Warner Bros. Television to distribute Cartoon Network, Warner Bros. Animation, and Adult Swim content, as well as TNT's Dallas, beginning in March 2013. The rights to these programs, previously held by Amazon Video, were given to Netflix shortly after deals with Viacom to stream Nickelodeon and Nick Jr. programs expired. However, Cartoon Network's ratings dropped by 10% in households that had Netflix, and so many of the shows from that channel and Adult Swim were removed in March 2015. Most of these shows were added to Hulu in May 2015.
Development of original programming (2013–2018)
In 2013, the company decided to slow launches in Europe to control subscription costs.
In February 2013, Netflix announced it would be hosting its own awards ceremony, The Flixies.
On March 13, 2013, Netflix added a Facebook sharing feature, letting United States subscribers access "Watched by your friends" and "Friends' Favorites" by agreeing. This was not legal until the Video Privacy Protection Act was modified in early 2013.
In February 2013, DreamWorks Animation and Netflix co-produced Turbo Fast, based on the movie Turbo, which premiered in July. Netflix has since become a major distributor of animated family and kid shows.
In November 2013, Netflix and Marvel Television announced a five-season deal to produce live-action Marvel superhero-focused series: Daredevil, Jessica Jones, Iron Fist and Luke Cage. The deal involves the release of four 13-episode seasons that culminate in a mini-series called The Defenders. Daredevil and Jessica Jones premiered in 2015. The Luke Cage series premiered on September 30, 2016, followed by Iron Fist on March 17, 2017, and The Defenders on August 18, 2017.
On March 7, 2014, new Star Wars content was released on Netflix's streaming service: the sixth and final season of the television series Star Wars: The Clone Wars, as well as all five prior and the feature film.
In April 2014, Netflix announced that it would raise the monthly price of the HD subscription plan from US$7.99 to $9.99 for new subscribers, but that existing customers would be grandfathered under this older price until May 2016, after which they could downgrade to the SD-only tier at the same price, or pay the higher fee for continued high definition access. In May 2014, Netflix increased the fee for UK subscribers by £1 per month, with existing members grandfathered at the previous price for two years.
In June 2014, Netflix unveiled a global rebranding: a new logo, which uses a modern typeface with the drop shadowing removed, and a new website UI. The change was controversial; some liked the new minimalist design, whereas others felt more comfortable with the old interface.
In April 2015, following the launch of Daredevil, Netflix director of content operations Tracy Wright announced that Netflix had added support for audio description (a narration track with aural descriptions of key visual elements for the blind or visually impaired), and had begun to work with its partners to add descriptions to its other original series over time. The following year, as part of a settlement with the American Council of the Blind, Netflix agreed to provide descriptions for its original series within 30 days of their premiere, and add screen reader support and the ability to browse content by availability of descriptions.
In September 2015, at the World Maker Faire New York, Netflix revealed a prototype of a device called "The Switch", which allows Netflix users to turn off lights when connected to a smart home light system. It also connects to users' local networks to enable their servers to order takeout, and silence one's phone at the press of a button. Though the device hasn't been patented, Netflix released instructions on its website, on how to build it at home (DIY). The instructions cover both the electrical structure and the programming processes.
In January 2016, at the 2016 Consumer Electronics Show, Netflix announced a major international expansion of its service into 130 additional countries. It then had become available worldwide except China, Syria, North Korea and Crimea.
Also in January 2016, Netflix announced it would begin VPN blocking of virtual private networks (VPNs) since they can be used to watch videos from a country where they are unavailable. The result of the VPN block is that people can only watch videos available worldwide and other videos are hidden from search results, which can however be found on the Unofficial Netflix Online Global Search (uNoGS) website.
In April 2016, Netflix announced it would be ending a loyalty rate in certain countries for subscribers who were continuously subscribed before price rises, raising their price to $9.99 per month.
In May 2016, Netflix created a tool called Fast.com to determine the speed of an Internet connection. It received praise for being "simple" and "easy to use", and does not include online advertising, unlike competitors.
In June 2016, George Keritsis, a Netflix subscriber, sued the company over price increases, alleging he was told by a Netflix customer support representative in 2011 that he would pay the same price in perpetuity as long as he maintained his subscription continuously. The plaintiff voluntarily dismissed the case in July 2016.
In July 2016, the science fiction horror Stranger Things premiered, music-driven drama The Get Down premiered in August 2016, British historical drama The Crown premiered in November 2016, and other premieres in 2016 included comedy shows such as Love, Flaked, Netflix Presents: The Characters, The Ranch, and Lady Dynamite.
On September 14, 2016, Netflix and 20th Century Fox jointly acquired US distribution rights to the Canadian independent drama film Two Lovers and a Bear following its screening at the Toronto International Film Festival on September 9, 2016.
On November 30, 2016, Netflix launched an offline playback feature, allowing users of the Netflix mobile apps on Android or iOS to cache content on their devices in standard or high quality for viewing offline, without an Internet connection.
In 2016, Netflix released an estimated 126 original series or films, more than any other network or cable channel.
In February 2017, Netflix announced 1,000 hours of original content to be released in 2017.
In February 2017, Netflix signed a music publishing deal with BMG Rights Management, whereby BMG will oversee rights outside of the United States for music associated with Netflix original content. Netflix continues to handle these tasks in-house in the United States.
In March 2017, at Barcelona's World Congress for mobile technologies, Netflix presented CNRS's open source technology creation: a compression tool allowing HD+ video quality with a bandwidth need of under 100 kilobytes per second, 40 times less than that of HDTV needs and compatible with mobile services worldwide. Since 2015, Netflix had received significant technical support from France's CNRS concerning video compression and formating, through CNRS' Laboratoire des Sciences du Numérique de Nantes (LS2N). 
On April 25, 2017, Netflix signed a licensing deal with IQiyi, a Chinese video streaming platform owned by Baidu, to allow selected Netflix original content to be distributed in China on the platform.
As of July 2017, Netflix series and movies accounted for more than a third of all prime-time download Internet traffic in North America.
In September 2017, Netflix announced it would offer its low-broadband mobile technology to airlines to provide better in-flight Wi-Fi so that passengers can watch movies on Netflix while on planes.
In September 2017, Minister of Heritage Mélanie Joly announced that Netflix had agreed to make a CDN$500 million (US$400 million) investment over the next five years in producing content in Canada. The company denied that the deal was intended to result in a tax break. Netflix realized this goal by December 2018.
In October 2017, Netflix iterated a goal of having half of its library consist of original content by 2019, announcing a plan to invest $8 billion on original content in 2018. There will be a particular focus on films and anime through this investment, with a plan to produce 80 original films and 30 anime series.
In October 2017, Netflix introduced the "Skip Intro" feature which allows customers to skip the intros to shows on its platform. They do so through a variety of techniques including manual reviewing, audio tagging, and machine learning.
In February 2018, Netflix acquired the rights to The Cloverfield Paradox from Paramount Pictures for $50 million and launched on its service on February 4, 2018, shortly after airing its first trailer during Super Bowl LII. While the film was critically panned, analysts believed that Netflix's purchase of the film helped to make the film instantly profitable for Paramount compared to a more traditional theatrical release, while Netflix benefited from the surprise reveal. Other films acquired by Netflix include international distribution for Paramount's Annihilation and Universal's News of the World and worldwide distribution of Universal's Extinction, Warner Bros.' Mowgli: Legend of the Jungle and Paramount's The Lovebirds.
In March 2018, Sky UK announced an agreement with Netflix to integrate Netflix's subscription VOD offering into its pay-TV service. Customers with its high-end Sky Q set-top box and service will be able to see Netflix titles alongside their regular Sky channels.
In April 2018, Netflix pulled out of the Cannes Film Festival, in response to new rules requiring competition films to have been released in French theaters. The Cannes premiere of Okja in 2017 was controversial, and led to discussions over the appropriateness of films with simultaneous digital releases being screened at an event showcasing theatrical film; audience members also booed the Netflix production logo at the screening. Netflix's attempts to negotiate to allow a limited release in France were curtailed by organizers, as well as French cultural exception law—where theatrically screened films are legally forbidden from being made available via video-on-demand services until at least 36 months after their release.
Expansion into international productions (2018–current)
In May 2018, chief content officer Ted Sarandos stated that Netflix had increased its spending on original content. Besides their traditional Hollywood markets as well as from partners like the BBC, Sarandos said they were also looking to expand investments in non-traditional foreign markets due to the growth of viewers outside of North America. At the time, this included programs such as Dark from Germany, Ingobernable from Mexico and 3% from Brazil. Sarandos had told Vulture, ""The exciting thing for me would be if the next Stranger Things came from outside America. Right now, historically, nothing of that scale has ever come from anywhere but Hollywood."
On May 22, 2018, former president Barack Obama and his wife Michelle Obama signed a deal to produce docu-series, documentaries and features for Netflix under the Obamas' newly formed production company, Higher Ground Productions. Higher Ground's first film, American Factory, won the Academy Award for Best Documentary Feature in 2020.
In June 2018, Netflix announced a partnership with Telltale Games to port its adventure games to the service in a streaming video format, allowing simple controls through a television remote. In September 2018, Telltale underwent a "majority studio closure" and laid off nearly its entire staff beyond a skeleton crew of 25 employees, citing a loss of funding. However, the first game, Minecraft: Story Mode, was released in November 2018.
In July 2018, Netflix acquired Lisa Taback's LT-LA consulting firm. Taback became VP of Talent Relations at Netflix.
On August 16, 2018, Netflix announced a three-year deal with black-ish creator Kenya Barris. Under the deal, Barris will produce new series exclusively at Netflix, writing and executive producing all projects through his production company, Khalabo Ink Society.
On August 27, 2018, the company signed a five-year exclusive overall deal with international best–selling author Harlan Coben. Under the multi-million pact, Netflix will work with Coben to develop 14 existing titles and future projects. On the same day, the company inked an overall deal with Gravity Falls creator Alex Hirsch.
In October 2018, according to Global Internet Phenomena Report, Netflix consumed 15% of all Internet bandwidth globally, the most by any single application.
In October 2018, Netflix paid under $30 million to acquire Albuquerque Studios (ABQ Studios), a film and TV production facility with eight sound stages in Albuquerque, New Mexico that cost $91 million to build.
In November 2018, Paramount Pictures signed a multi-picture film deal with Netflix, making Paramount the first major film studio to sign a deal with Netflix. A sequel to AwesomenessTV's To All the Boys I've Loved Before was released on Netflix under the title To All the Boys: P.S. I Still Love You as part of the agreement.
In December 2018, the company announced a partnership with ESPN Films on a television documentary chronicling the 1997–98 Chicago Bulls season titled The Last Dance. It was released internationally on Netflix and became available for streaming in the United States three months after a broadcast airing on ESPN.
In January 2019, Sex Education made its debut as a Netflix original series with much critical acclaim. It was praised for its refreshing take on the teen dramedy genre with honesty, vulnerability, and raunch.
In February 2019, The Haunting creator Mike Flanagan joined frequent collaborator Trevor Macy as a partner in Intrepid Pictures and the duo signed an exclusive overall deal with Netflix to produce television content.
In early August 2019, Netflix negotiated an exclusive multi-year film and television deal with Game of Thrones creators/showrunners David Benioff and D.B. Weiss reportedly worth US$200 million. Due to their commitments to Netflix, Benioff and Weiss withdrew from an earlier agreement with Disney to write and produce a Star Wars film series. The first Netflix production created by Benioff and Weiss was planned as an adaptation of Liu Cixin's science fiction novel The Three-Body Problem, part of the Remembrance of Earth's Past trilogy.
On September 30, 2019, in addition to renewing Stranger Things for a fourth season, Netflix announced signing the series’ creators The Duffer Brothers to a nine-figure deal for additional films and televisions shows over multiple years.
On November 13, 2019, Netflix and Nickelodeon, owned by ViacomCBS, entered into a multi-year content production agreement to produce several original animated feature films and television series based on Nickelodeon's library of characters, in order to compete with Disney+, which had launched the day before. This agreement expanded on their existing relationship, in which new specials based on the past Nickelodeon series Invader Zim and Rocko's Modern Life (Invader Zim: Enter the Florpus and Rocko's Modern Life: Static Cling respectively) were released by Netflix. Glitch Techs was the first series to be released as part of the new agreement. Other new projects planned under the team-up include a music project featuring Squidward Tentacles from the animated television series SpongeBob SquarePants, and films based on The Loud House and Rise of the Teenage Mutant Ninja Turtles.
In January 2020, Netflix announced a new four-movie deal with Adam Sandler worth up to $275 million.
In January 2020, Gwyneth Paltrow's series The Goop Lab was added as a Netflix Original. This led to widespread criticism of the streaming company for giving Paltrow a platform to promote her company Goop, which has been criticized for making unsubstantiated claims about the effectiveness of the health treatments and products it promotes.
On January 20, 2020, Netflix acquired exclusive streaming rights to the film library of Studio Ghibli (with the exception of Grave of the Fireflies) worldwide except in the U.S., Canada, China and Japan as part of an agreement with Ghibli's international seller Wild Bunch.
On February 25, 2020, Netflix formed partnerships with six Japanese creators to produce an original Japanese anime project. This partnership includes manga creator group CLAMP, mangaka Shin Kibayashi, mangaka Yasuo Ohtagaki, novelist and film director Otsuichi, novelist Tow Ubutaka, and manga creator Mari Yamazaki.
In June 2020, Bozoma Saint John was named CMO.
Bloomberg reported in 2019 that Ted Sarandos had risen past CEO Reed Hastings in salary, and that key company decisions were being made in Los Angeles where Sarandos kept his office. In July 2020, Netflix appointed Sarandos as co-CEO.
In September 2020, Netflix signed a multi-million dollar deal with the Duke and Duchess of Sussex. Harry and Meghan agreed to a multi-year deal promising to create TV shows, films, and children's content as part of their commitment to stepping away from the duties of the royal family.
In October 2020, Netflix announced a restructuring of executive management in its entertainment division.
In March 2021, Netflix warned users against sharing passwords of their account with others.
In March 2021, Netflix announced that it would work to reach net zero greenhouse gas emissions by the end of 2022, while investing in programs to preserve or restore ecosystems. The company stated that it would cut emissions from its operations and electricity use by 45% by 2030. Due to the COVID-19 pandemic and lack of content production, Netflix had a 14% drop in emissions in 2020.
On April 8, 2021, Sony Pictures Entertainment announced an agreement for Netflix to hold the U.S. pay television window rights to its releases beginning 2022, replacing Starz and expanding upon an existing agreement with Sony Pictures Animation. The agreement also includes a first-look deal for any future direct-to-streaming films being produced by Sony Pictures, with Netflix required to commit to a minimum number of them.
On April 27, 2021, Netflix announced that it was opening its first Canadian headquarters in Toronto. The company also announced that it would open an office in Sweden as well as Rome and Istanbul to increase its original content in those regions.
On June 7, 2021, Jennifer Lopez's Nuyorican Productions signed a multi-year first-look deal with Netflix spanning feature films, TV series, and unscripted content, with an emphasis on projects that support diverse female actors, writers, and filmmakers. Lopez co-runs Nuyorican Productions with her producing partner Elaine Goldsmith-Thomas.
On June 17, 2021, Netflix announced a multi-year overall deal with comedy writer-producer Danielle Sanchez-Witzel. Under the deal, the first major talent pact since Tracey Pakosta joined Netflix as VP, Original Comedy Series, Sanchez-Witzel will set up her own production banner and focus on original development for series and features in addition to supervising and executive producing other projects.
On June 21, 2021, Steven Spielberg's Amblin Partners signed a deal with Netflix to release multiple new feature films for the streaming service. Amblin is expected to produce at least two films a year for Netflix for an unspecified number of years.
In July 2021, Netflix announced plans to release mobile games which would be included in subscribers' plans to the service. Trial offerings were first launched for Netflix users in Poland in August 2021, offering premium mobile games based on Stranger Things including Stranger Things 3: The Game, for free to subscribers through the Netflix mobile app.
On July 14, 2021, Netflix signed a first-look deal with Joey King, star of The Kissing Booth franchise, in which King will produce and develop films for Netflix via her All The King's Horses production company.
On July 21, 2021, Zack Snyder, director of Netflix's Army of the Dead, announced he had signed his production company The Stone Quarry to a first-look deal with; his upcoming projects include a sequel to Army of the Dead, the sci-fi adventure film Rebel Moon. In 2019, he agreed to produce an anime-style web series inspired by Norse mythology.
As of August 2021, Netflix Originals made up 40% of Netflix's overall library in the United States. The company announced that "TUDUM: A Netflix Global Fan Event", a three-hour virtual behind the scenes featuring first-look reveals for 70 of the streamer's properties, would have its inaugural show in late September 2021. In 2021, Peter Friedlander was named head of the studio.
Squid Game, a South Korean survival drama created and produced by Hwang Dong-hyuk, had been acquired and produced by Netflix in 2019 as part of its expansion of foreign works, and was released worldwide in multiple languages on September 17, 2021. The show rapidly became the service's most-watched show within a week of its launch in many markets, including Korea, the U.S. and the UK. Within its first 28 days on the service, Squid Game drew more than 111 million viewers, surpassing Bridgerton and becoming Netflix's most-watched show.
On September 21, 2021, Netflix announced that it would acquire the Roald Dahl Story Company, which manages the rights to Roald Dahl's stories and characters, for an undisclosed price and would operate it as an independent company.
On October 13, 2021, Netflix announced the launch of the Netflix Book Club, where readers will hear about new books, films, and series adaptations, as well as have exclusive access to each book’s adaptation process. Netflix will partner with Starbucks to bring the book club to life via a social series called But Have You Read the Book?. Uzo Aduba will serve as the inaugural host of the series and announce monthly book selections set to be adapted by the streamer. Aduba will also speak with the cast, creators, and authors about the book adaptation process over a cup of coffee at Starbucks.
|End of year||Paying VOD |
in mil. USD-$
|Net income |
in mil. USD-$
|Price per Share |
|Employees||Paid memberships |
Netflix grants all employees extremely broad discretion with respect to business decisions, expenses, and vacation—but in return expects consistently high performance, as enforced by what is known as the "keeper test." All supervisors are expected to constantly ask themselves if they would fight to keep an employee. If the answer is no, then it is time to let that employee go. A slide from an internal presentation on Netflix's corporate culture summed up the test as: "Adequate performance gets a generous severance package." Such packages reportedly range from four months' salary in the United States to as much as six months in the Netherlands.
The company offers unlimited vacation time for salaried workers and allows employees to take any amount of their paychecks in stock options.
About the culture that results from applying such a demanding test, Hastings has said that "You gotta earn your job every year at Netflix," and, "There's no question it's a tough place...There's no question it's not for everyone." Hastings has drawn an analogy to athletics: professional athletes lack long-term job security because an injury could end their career in any particular game, but they learn to put aside their fear of that constant risk and focus on working with great colleagues in the current moment.
Payment to producers
Netflix's video on demand streaming service, formerly branded as Watch Now, allows subscribers to stream television series and films via the Netflix website on personal computers, or the Netflix software on a variety of supported platforms, including smartphones and tablets, digital media players, video game consoles and smart TVs. According to a Nielsen survey in July 2011, 42% of Netflix users used a standalone computer, 25% used the Wii, 14% by connecting computers to a television, 13% with a PlayStation 3 and 12% an Xbox 360.
Netflix service plans are divided into three price tiers; the lowest offers standard definition streaming on a single device (and up to 480p quality), the second allows high definition streaming on two devices simultaneously (and up to 1080p quality), and the "Platinum" tier allows simultaneous streaming on up to four devices (and up to 4K quality on supported devices and internet connections).
In the United States, the company provides a monthly flat rate for DVD and Blu-ray rentals. A subscriber creates a rental queue, a list, of films to rent. The films are delivered individually via the United States Postal Service from regional warehouses. The subscriber can keep the rented disc as long as desired, but there is a limit on the number of discs that each subscriber can have simultaneously via different tiers. To rent a new disc, the subscriber must return the previous disc in a metered reply mail envelope. Upon receipt, Netflix ships the next available disc in the subscriber's rental queue.
The DVD rental service is now branded as DVD Netflix.
Netflix can be accessed via an internet browser on PCs, or via an app installed on smart TVs, set-top boxes connected to televisions, tablet computers, mobile phones, digital media players, Blu-ray Disc players, and video game consoles (including Xbox Series X/S, Xbox One, PlayStation 5, PlayStation 4, Wii U, Xbox 360, and the PlayStation 3). It is also accessible on internet browsers or dedicated apps on some virtual reality headsets such as those produced by VIVE, Valve and Oculus. There are additional hardware, internet access, and subscription requirements for streaming in 4K resolution.
Netflix has a Twitter feed, used to tweet about the new and upcoming shows that include hashtags to encourage engagement of its audience to not only watch the show but to contribute to the hashtag themselves.
A "Netflix Original" is content that is produced, co-produced, or distributed by Netflix exclusively on its services.
Film and television deals
Netflix has exclusive pay TV deals with several studios. The deals give Netflix exclusive streaming rights while adhering to the structures of traditional pay TV terms.
Distributors that have licensed content to Netflix include Warner Bros., Universal Pictures, Sony Pictures Entertainment and The Walt Disney Studios (including 20th Century Fox). Netflix also holds current and back-catalog rights to television programs distributed by Walt Disney Television, DreamWorks Classics, Kino International, Warner Bros. Television and CBS Television Distribution, along with titles from other companies such as Allspark (formerly Hasbro Studios), Saban Brands, and Funimation. Formerly, the streaming service also held rights to select television programs distributed by NBCUniversal Television Distribution, Sony Pictures Television and 20th Century Fox Television.
Producers and distributors
The following list only applies to the United States. Listed companies may still or may not have licensing agreements with Netflix in other territories.
- 9 Story Media Group
- Aardman Animations
- Aniplex of America
- Bento Box Entertainment
- Big Idea Entertainment
- Bleecker Street
- Boat Rocker Media
- Cake Entertainment
- Chernin Entertainment
- Constantin Film
- DreamWorks Animation
- Entertainment One
- Epic Pictures
- Fox Entertainment
- Frederator Studios
- Gaumont Film Company
- Kino International
- Magnolia Pictures
- Nordisk Film
- Open Road Films
- Oscilloscope Laboratories
- PBS Kids
- Rat Pack Filmproduktion
- Red Chillies Entertainment
- Relativity Media
- Saban Brands
- Shout! Factory
- Skydance Media
- Studio 100
- Sony Pictures
- Titmouse, Inc.
- The Pokémon Company
- Viz Media
- Wow Unlimited Media
Netflix has released content that is interactive on certain devices, whereby the user makes choices that change the story and accompanying video track.
The following is a list of interactive titles:
|Black Mirror: Bandersnatch||Film||December 28, 2018|
|The Boss Baby: Get That Baby!||Animation||September 1, 2020|
|Buddy Thunderstruck: The Maybe Pile||Animation||July 14, 2017|
|Captain Underpants Epic Choice-o-Rama||Animation||February 11, 2020|
|Carmen Sandiego: To Steal or Not to Steal||Animation||March 10, 2020|
|Headspace: Unwind Your Mind||Documentary||June 15, 2021|
|Minecraft: Story Mode||Animation||November 27, 2018|
|Puss in Boots: Trapped in an Epic Tale||Animation||June 20, 2017|
|Spirit Riding Free: Ride Along Adventure||Animal Tales||December 8, 2020|
|Stretch Armstrong: The Breakout||Animation||March 13, 2018|
|Unbreakable Kimmy Schmidt: Kimmy vs. the Reverend||Sitcom||May 12, 2020|
|You vs. Wild||Series||April 10, 2019|
On July 18, 2013, Netflix earned the first Primetime Emmy Award nominations for original online-only web television programs at the 65th Primetime Emmy Awards. Three of its web series, Arrested Development, Hemlock Grove and House of Cards, earned a combined 14 nominations (nine for House of Cards, three for Arrested Development and two for Hemlock Grove). The House of Cards episode "Chapter 1" received four nominations for both the 65th Primetime Emmy Awards and 65th Primetime Creative Arts Emmy Awards, becoming the first webisode of a television series to receive a major Primetime Emmy Award nomination: David Fincher was nominated in the category of Outstanding Directing for a Drama Series. "Chapter 1" joined Arrested Development's "Flight of the Phoenix" and Hemlock Grove's "Children of the Night" as the first webisodes to earn Creative Arts Emmy Award nomination, and with its win for Outstanding Cinematography for a Single-Camera Series, "Chapter 1" became the first webisode to be awarded an Emmy. Fincher's win for Directing for a Drama Series made the episode the first Primetime Emmy-awarded webisode.
On December 12, 2013, the network earned six nominations for Golden Globe Awards, including four for House of Cards. Among those nominations was Wright for Golden Globe Award for Best Actress – Television Series Drama for her portrayal of Claire Underwood, which she won at the 71st Golden Globe Awards on January 12. With the accolade, Wright became the first actress to win a Golden Globe for an online-only web television series. It also marked Netflix' first major acting award. House of Cards and Orange is the New Black also won Peabody Awards in 2013.
On July 10, 2014, Netflix received 31 Emmy nominations. Among other nominations, House of Cards received nominations for Outstanding Drama Series, Outstanding Directing in a Drama Series and Outstanding Writing in a Drama Series. Kevin Spacey and Robin Wright were nominated for Outstanding Lead Actor and Outstanding Lead Actress in a Drama Series. Orange is the New Black was nominated in the comedy categories, earning nominations for Outstanding Comedy Series, Outstanding Writing for a Comedy Series and Outstanding Directing for a Comedy Series. Taylor Schilling, Kate Mulgrew, and Uzo Aduba were respectively nominated for Outstanding Lead Actress in a Comedy Series, Outstanding Supporting Actress in a Comedy Series and Outstanding Guest Actress in a Comedy Series (the latter was for Aduba's recurring role in season one, as she was promoted to series regular for the show's second season).
Netflix got the largest share of 2016 Emmy award nominations among its competitors, with 16 major nominations. However, streaming shows only got 24 nominations out of a total of 139, falling significantly behind cable. The 16 Netflix nominees were: House of Cards with Kevin Spacey, A Very Murray Christmas with Bill Murray, Unbreakable Kimmy Schmidt, Master of None, and Bloodline.
Stranger Things received 19 nominations at the 2017 Primetime Emmy Awards, while The Crown received 13 nominations. In April 2017, it was nominated for Broadcaster of the Year in the UK's Diversity in Media Awards. In December 2017, it was awarded PETA's Company of the Year for promoting animal rights movies and documentaries like Forks Over Knives and What the Health.
At the 90th Academy Awards, held on March 4, 2018, Netflix won the Oscar for Best Documentary Feature for the film Icarus. During his remarks backstage, director and writer Bryan Fogel remarked that Netflix had "single-handedly changed the documentary world". Icarus had its premiere at the 2017 Sundance Film Festival and was bought by Netflix for $5 million, one of the biggest deals ever for a non-fiction film. Netflix became the most nominated network at the 2018 Primetime and Creative Arts Emmy Awards with 112 nominations, therefore breaking HBO's 17-years record as most nominated network at the Emmys, which received 108 nominations.
On January 22, 2019, Netflix scored 15 nominations for the 91st Academy Awards, including Best Picture for Alfonso Cuarón's Roma, which was nominated for 10 awards. The 15 nominations equal the total nominations Netflix had received in previous years. Its increased presence in the Academy Awards has led filmmakers such as Steven Spielberg to speak out against the nomination of streaming content. As a possible solution, Netflix is in the process of buying Grauman's Egyptian Theatre to host events and screen its films and series. However, there are no plans to roll out full theatrical releases there.
In 2020, Netflix gained 20 TV nominations and 22 film nominations at the Golden Globes awards. It secured three out of the five nominations for best drama TV series for The Crown, Ozark and Ratched and four of the five nominations for best actress in a TV series: Olivia Colman, Emma Corrin, Laura Linney and Sarah Paulson. Netflix also gained 30 nominations at the Screen Actor Guilds Awards (won 7 awards) and 35 nominations at the Academy Awards (also won 7 awards).
Netflix has been subject to criticism from various groups and individuals as its popularity and market reach increased in the 2010s.
Customers have complained about price increases in Netflix offerings dating back to the company's decision to separate its DVD rental and streaming services, which was quickly reversed. As Netflix increased its streaming output, it has faced calls to limit accessibility to graphic content and include viewer advisories for issues such as sensationalism and promotion of pseudoscience. Netflix's content has also been criticized by disability rights advocates for lack of captioning quality.
Some media organizations and competitors have criticized Netflix for selectively releasing ratings and viewer numbers of its original programming. The company has made claims boasting about viewership records without providing data to substantiate its successes or using problematic estimation methods. During the COVID-19 pandemic, some government agencies called for Netflix and other streamers to limit services due to increased broadband and energy consumption as large amounts of the world’s population were at home. In March 2020, the company announced it would reduce bit rates across all streams in Europe, thus decreasing Netflix traffic on European networks by around 25 percent. These same steps were later taken in India.
Its distribution model for original films has led to conflicts with the legacy film industry. Some cinema chains have refused to screen films distributed theatrically by Netflix as the company's release method defies standard release windows. Questions have been raised in reference to the eligibility of Netflix's original films for prestigious accolades like the Academy Awards. The U.S. Justice Department warned the Academy that attempts to change its rules to discriminate against Netflix and other streaming platforms could violate antitrust laws, as the parent companies of the traditional major studios have been making investments into streaming services that are in direct competition with Netflix. After the COVID-19 pandemic forced theaters around the country to close for several months in 2020, the next year WarnerMedia, Disney and Universal each released films on their respective streaming services, HBO Max, Disney+ and Peacock, on the same day they were released in theaters.
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Netflix has 58 shipping locations
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