Netflix as a provider of streaming video

"Netflix and Chill – A euphemism for inviting someone over to their place to engage in sexual activity."
Urban Dictionary

Netflix, along with other streaming services, has been responsible for changing how we consume. Nowadays with a decent internet connection and a subscription, there's no need to run to the store and collect masses of plastic discs. We can sit at home in front of a computer or TV, or almost anywhere with a mobile phone or tablet, and binge-watch until we starve. Unless we order something through Uber Eats.

Netflix began in 1997 by offering a subscription service for DVDs. It was a simple enough model; you paid a monthly fee and you got a certain number of films delivered to your door each month. Prepaid envelopes made returns easy, and you could easily order your next film online. This model dealt a blow to the likes of the already-struggling Blockbuster and the mom-and-pop video rental stores on your High Street, thus contributing to the Walmart effect and the death of the downtown. But Netflix was convenient, was easy to use and of course everyone used it because it was cheap and we didn't have to go out in all weathers to get our media fixes (provided you had access to the internet!) Netflix had us participate in our own manipulation. This of course is widely viewed as a Bad Thing by many people.

Out with the old, in with the new

Once Netflix had won hearts, minds and credit card details, in 2007 they began to offer streaming services. The growth of cheap broadband home service now meant you no longer had to wait a few days for your next film or TV series, you could just hook up with Netflix and bag the video online. Soon, DVD rental customers were able to download an unlimited number of films and whatnot for live consumption, and soon enough, streaming services overtook DVD rentals. Deals were made with various studios to enable them to protect their media sales, all the while planning their own expansion in the streaming field to counteract threats from the likes of Hulu and Apple. By 2010 they were doing deals with anyone they could, signing up several deals with film producers and distributors. At the same time they were dipping their toes in international waters, expanding their streaming services overseas, beginning with Canada and many South American countries.

In 2011 they announced the separation of the DVD rental and streaming services, riding on their 30% streaming share in the US and Canada, although outraged uproar from consumers had them roll back that decision. Meanwhile whey were still wheeling and dealing, starting a Political Action Committee called FLIXPAC, "to engage on issues like net neutrality and bandwidth caps". Overseas expansion continued in Europe, all the while scooping up more and more TV shows and films from as many distributors as they could.

Not content with rescuing productions like Breaking Bad, Netflix started planning to move into producing new, original material, beginning with House of Cards, to be followed by Orange is the New Black. They've had many successes here, including The Crown, The Witcher and The Sandman just to mention a few. They've also been responsible for rescuing many series, like Arrested Development. If only they'd begun this a few years earlier perhaps we might have had more Firefly.

Controversy and the future

They've faced their fair share of controversy, both from end-users, the film industry and advocacy groups. Criticism has ranged from showing censored versions of films (Back to the Future), for "romanticizing" suicide (13 Reasons Why), and of course health and moral critique (smoking in House of Cards, the gay Jesus in The First Temptation of Christ). They have also produced various series that have been accused of promoting pseudoscience, such as the archaeology program Ancient Apocalypse (which argues for an ancient civilisation predating conventional scientific thinking), a documentary on Gwyneth Paltrow's dubious products in The Goop Lab and the travel series Down to Earth with Zac Efron which makes exaggerated claims about a variety of diets and superfoods.

Users have griped about the recent clampdown on password sharing between family members, and whilst I can see their point, I also hear the criticism that members of a household are frequently spending time away from home and that the Netflix algorithms need fine-tuning to cope. After the introduction of this adjustment to their terms, the number of new accounts (with an increased revenue stream) was clear to see. Of course, the likes of Cory Doctorow have pointed fingers at them for the enshittification of their service and the abuse of their userbase for profit, and for not doing enough to support users on the fringe:

"Netflix says that its new policy allows members of the same 'household' to share an account. This policy comes with an assumption: that there is a commonly understood, universal meaning of 'household,' and that software can determine who is and is not a member of your household."
There's a fine line to be trodden there, and my internal jury is still out on that one.

Netflix continues to push at both reducing costs and advancing technology to support their platform. Given that their streaming accounts for about a third of download bandwidth during the evening hours, they have a vested interest in saving money both for themselves and their internet partners. To that end they've developed what is in effect their own content delivery network using their own dedicated hardware. This can be installed at collaborating ISPs, enabling them to cache content rather than fetch it as required. In addition there are several settlement-free exchanges available. Both these features reduce the need for pressure on bandwidth at peak viewing times. The end result is that Netflix itself no longer requires its own physical data centres.

For better or for worse, streaming content is now vastly preferred over all other means of media distribution. Proof, were it needed, is in the vast numbers of DVD (and even Blu-Ray) discs available at your local second-hand shop or thrift store. Owning media is out, streaming is in. I have some catching up to do.

$ xclip -o | wc -w
A DVD rental company operating exclusively online, NetFlix mails you the movies you choose with a postage-paid return mailer.

Their flagship program, Marquee, is an "all you can rent" salad bar of movies. They charge a monthly fee, and you get to have up to 2, 4, or 8 movies (depending on the fee you choose) checked out at any time. You can keep them for months at a time if you want, or you can rush them back and get new movies.

I've had some interesting customer service issues with them, but my case seems to have been an exception. Overall, it seems a decent opportunity to see lots of movies without having to worry about spending loads of money on separate rentals...

For people like me, the huge advantage with the Marquee system is you never have a late fee. I am very bad at returning movies to traditional movie rental locations, so this is a perfect solution for me. Before I got Netflix I often wound up paying more in late fees than the movie is worth.

Still, I only wind up renting about one movie a month, which could equate to the cost of buying the movie, but at least I can't run up 80 dollars in late fees for a 20 dollar DVD :)

I only wish local stores would start doing something like this, because it sucks to be in the mood for a certain movie, so you go put it first in your queue, send back a DVD you have, and then wait a week. Bah.

If some local movie rental place did a Netflix marquee style rental system, I'd go for it in an instant. Although I can see why they don't, because, one little store couldn't handle the bad mojo they'd get when people go in to get something specific and it's not in stock.

I imagine Netflix must have dozens of copies of lesser-rented movies, and hundreds of copies of popular movies, so that there is enough volume to allow for at least a few copies to always be in stock, or at least for one to be returned soon enough that it doesn't matter.

BTW, I remember when Netflix started, it was a regular rental service. It was like 4 bucks per movie to rent, and you had to return it within a certain amount of time. This is sort of like how normal movie rental shops do it now. Whoever was cool enough to come up with the idea for the marquee system should be paid enough money to retire :)

If movies are my heroin (they are), then Netflix is my dealer. As mentioned above, Netflix is a way to rent DVDs over the Web. Without late fees. Without standing in line. And you can rent as many as you'd like in a given month. If you watch a lot of movies and your tastes run perhaps a bit more obscure than what's stocked at the local chain store, then Netflix provides a service which you may be very interested in.

Note: Despite my great love for the company, I am not a shill for Netflix. I've used the service for more than three years, but I am not employed by the company nor do I own any stock or stand to gain financially in any way from its success. I just really like it.

How does it work?

First, you head over to the company's Web site at You can sign up for a trial plan if you'd like to test things out. But, basically you'll give Netflix your credit card number. Then you'll choose a plan. As of February 2003, the company has four plans:

  • Economy: $13.95/month -- but you only get two at a time, and you're limited to a maximum of four movies a month, total. Probably best for the casual movie watcher who only goes to the video store a few times in a month.
  • Standard: $19.95/month -- you can have three movies out at once, and you get as many rentals per month as you'd like. The plan most people (that I know, anyway) use.
  • Plus: $29.95/month -- five movies out at a time, unlimited rentals per month. Seems a bit excessive to me, but if you've got a lot of time on your hands, might be tempting.
  • Ultimate: $39.95/month -- eight movies out, unlimited rentals per month. I don't really think it's possible to watch movies quickly enough to make use of this plan. The only thing I can think of is you've got a large family or a bunch of roommates or something.

Once you're signed up, you go ahead and browse or search through Netflix's list of available DVDs. If you see one you're interested in, you click a little "Rent" button. That movie then gets added into your rental queue.

The queue is one of the coolest inventions Netflix has, in that it makes the entire experience feasible. You've got a limit of how many DVDs you can have out at once, determined by the price of your plan. The standard plan, for instance, gives you three movies at once. This means that Netflix will go ahead and mail the top three in-stock choices in your queue to you. If there's a movie in your top three choices that's out-of-stock, Netflix skips it and goes down the list. When you send a movie back, Netflix releases the next available movie on the queue. The idea is that, so long as you have a sufficiently long queue, you'll always have movies checked out.

It seems that most people enjoy making really long queues, and indeed it's easy to do so once you see how many movies there are that you're dying to see. Browsing and searching through Netflix's extensive catalogue makes it easy to build a very large queue quickly. In fact, I've noticed that it has become a badge of honor among my Netflix-using friends to have the longest queue possible. No, I don't get it either.

What about shipping?

Shipping is free. Netflix pays shipping costs to get the movie to your house and each DVD comes in a resealable, postage prepaid envelope. When you're done watching the movie, you just put the DVD back in its mailer, seal it, and put it in the mail. All shipping is done via first-class mail.

The length of time it takes to get movies is actually quite short. Netflix has 13 different distribution centers scattered throughout the United States, so it should only take a day or two for the DVDs to get from Netflix to a renter, and vice-versa.

I'm a few hours away from Netflix's distribution center in Los Angeles (specifically in Santa Anna), and Netflix gets my movies the day after I put them in the mailbox. So if I put a DVD in the mail on a Monday, Netflix has it on Tuesday. The company's turn-around time has always been fantastic, in my experience, and they usually get a new movie in the mail within hours of their reception of an old one. So when I mail a movie on Monday, I have a replacement by Wednesday. Obviously, times may vary depending upon your proximity to a distribution center, but here's the complete list:

The company says it plans to have 70 percent of its subscriber base to have overnight delivery by the end of 2003. Netflix had more than 850,000 subscribers as of January, 2003 so it seems like continued expansion is part of the company's goals.

Other Benefits

Beyond a doubt, my favorite feature of Netflix is its vast library of movies to choose from. The company claims it offers 13,500 titles, and in my experience it has had almost every Region 1 DVD available (it doesn't carry some out-of-print titles and it doesn't rent porn anymore). There are a lot of really great, obscure movies that I'm never going to be able to rent at Blockbuster or Hollywood Video, and I use Netflix for getting my hands on these.

I really like the queue system, as it's a handy way of keeping track of movies I want to see (being a huge geek, I have an Excel spreadsheet with a list of 175+ movies I want to see, but Netflix was nice before I built that).

Also, like many other Web sites (such as, Netflix encourages users to rate movies. Once you've rated a few movies, it begins building a profile of your tastes and then recommends movies it thinks you'll like. Surprisingly, this system works pretty damn well and I've selected some movies based upon its recommendations that I ended up really liking. Of course, as of this writing I've rated around 650 movies on Netflix, so it may be that it just has a lot of data to work with. Nonetheless, the rating system is easy to use and is elegantly incorporated into the site. Wherever a movie title is listed, there are stars next to it. You just select how many stars you think the movie deserves out of five and it logs your response.

I've also found Netflix's customer service to have always been helpful, though I can't say I've had much need of it. But when I've received a scratched disc or something, they've been quick in replacing it. One time a movie I sent back got lost in the mail, and the company treats its customers with respect (what a novel concept today!) and believed me. It's the company's policy to not charge customers for movies that are lost in the mail unless the customer starts losing a disproportionate number of DVDs. Try telling Blockbuster that you returned a movie when they claim you didn't!

The company also seems to be loyal to their older customers. I've been using the service since February 2000, and back then the prices were lower. The company has always allowed me to keep my original plan of paying $20 per month and getting four movies at once instead of the now-standard three. I find that nice.

What's bad?

Honestly, I don't have many complaints. Discs seem to be dirty a lot, but since I very rarely rent DVDs from anywhere else I'm not sure how common this is. Only once has a movie been so badly damaged that a scene wouldn't play. Normally, dirty discs just skip a bit, and some need to be cleaned. I suspect the mailers may not be incredibly easy on the DVDs, but it's a minor annoyance and not a major problem.

The other problem with the service is inherent in the business model. You can't just go and rent a movie on the spur of the moment. You have to do a little bit of planning, and it kind of sucks when you're in the mood for a comedy and all the movies you have out are weighty dramas. Given the fast turn-around time, though, this is becoming less of a problem. With a little bit of foresight, it's pretty easy to ensure a nice variety of movies for the weekend.

Otherwise, as should be obvious from the tone of this write-up, I'm a very satisfied customer. I strongly recommend the service to most film buffs or people who just watch a lot of movies. If you only rent a few DVDs per month and most of those are mainstream new releases, a standard video store is probably more cost-efficient. Given that the chain stores seem to charge around $4-5 for a DVD rental, it makes sense to me to consider Netflix if you rent four or movies per month. If nothing else, what you save in not paying late fees should make it worth the subscription.

Note: Edame has informed me about a similar service, called Webflix which is based out of the U.K. The Web site is at The two companies don't appear to be related in any sort of official capacity, but the services seem similar. I encourage anyone with more information on Webflix to node it and/or contact me.

Update: March 3, 2003 -- Sometimes there are some weird coincidences. dannye had signed up for the service shortly before this writeup was posted Feb. 25. Netflix has since announced that it signed up its millionth customer that same week. I also know that riverrun signed up right after this writeup was posted. Did E2 put Netflix over a million? It's quite possible...


Most information for this writeup came from my own experience. Statistics on pricing/factual information about the company came from the Netflix Web site located at

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