In 1975, Eckhard Baum opened the first video 

rental shop opened in Kassel, West Germany

It was named VideoThek, meaning video library. 

Baum rented out films on the Super 8 format.

The business model took hold and soon spread to America

By 1985, there were over 15000 video rental shops in America.

The largest players were Blockbuster and Hollywood Video.

Founded 1975

Founded 1998

--

Started streaming in 2007

Netflix's main advantages:

Death of Distance - 

Traveling to a store vs delivery by mail vs instant online delivery

Algorithmication - 

Netflix is able to deliver personalized content to its viewers and predict what its customers might want to see based on their viewing history.

Economies of Scale - 

While Netflix may have had high fixed costs in developing its infrastructure, Netflix is able to deliver content to its users for very cheap. The service scales very well. 

Networked structure: 

Netflix is an amplifier for content creators' voices to be heard on the internet in the form of movies

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The Evolution of Home Video

by jmliu

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Public - 5/7/16, 1:40 AM