20 Things You Didn’t Know About Netflix
The streaming service is 20 today. Here are its secrets.
When I’m rifling through Netflix, nightly, and failing to find some third-tier indie rom-com to half-watch, I have one thought: “Netflix doesn’t know what they’re doing.”
I am wrong.
Founded on August 29th, 1997 by co-founders Reed Hastings and Marc Randolph, the DVD-rental-turned-streaming service now has 104 million subscribers in more than 190 countries (47% of Netflix subscribers are international) and a market cap of $69 billion.
It’s a frustrating service, sure. But anyone that produces BoJack Horseman gets a temporary pass — so for one day, we’ll forgive the glitchy picture quality, the increasingly useless recommendations/ratings system and dwindling supply of A-level movies.
To celebrate 20 years of mostly a good thing, here are 20 things you may or may not know about the service that has come to define our collective viewing habits.
1. The original logo makes you wonder how they survived.
It looked like something your local library would create. The year was 1997, and they were announcing their bitchin’ new VHS collection.
2. The company’s origin story was a fun lie.
The #fakenews here was that Hastings was so incensed by a $40 late fee he received after returning Apollo 13 that he started a competitor out of spite. ‘merica! The real story is that Hastings and Randolph wanted to (yawn) create “the Amazon.com of something.”
3. Their first big success was a two-cent Bill Clinton DVD.
Originally offering DVD sales as well as rentals, Netflix made 10,000 copies of Bill Clinton’s 1998 Grand Jury testimony during the Monica Lewinsky investigation available for just two cents (plus handling and shipping). According to Funding Universe, a manufacturing plant accidentally sent some buyers pornographic DVDs instead.
4. Netflix’s first great innovation was “unlimited subscriptions.”
While Blockbuster was generating up to 16% of its profits from “late fees,” Hastings and co. basically eliminated them: starting in 1999, the company shifted to flat-fee unlimited rentals.
5. Blockbuster could have had ’em for $50 million.
That was the offer made in 2000. The video rental giant refused, calling Netflix a “very small niche business” and soon started their own DVD-by-mail service. Today, you can find Blockbuster in Alaska and through one hilarious fake Twitter account.
6. Netflix’s original initial public offering was $15 per share.
That was 2002. Today, those shares are $167.
7. Now their primary business, Netflix didn’t debut streaming until 2007.
And they didn’t start original programming until 2013. Pivoting is good!
8. Netflix tried to break itself up and form two companies.
In 2011, Hastings tried to split off Netflix’s DVD division into a video rental and video games company called Qwikster, as well as hiking rates by up to 60 percent. After costing the company upwards of 800,000 subscribers, along with a 37 percent decline in stock price, Netflix “qwikly” dropped the plan. Pivoting is bad!
9. DVDs still account for a fraction of their business.
Nine percent, actually, and they’re only available in the United States. Oh, and for those of us who still use the service, we continue to allege that they are purposely slowing down their shipping to disrupt “power users.”
10. Your recommendations will change over time.
Netflix’s algorithm, which offers personalized choices for viewers, is constantly evolving. In 2009, the company awarded a million dollars to develop a better recommendations system via a public contest. This year, they tweaked the formula again and announced they’re replacing the five-star rating system with a thumbs-up or -down model.
11. Netflix knows you like Adam Sandler and don’t watch documentaries.
Bitch about the company tracking your viewing habits all you want — they do that because you lie. As the company’s VP of personalization algorithms noted in 2013: “A lot of people tell us they often watch foreign movies or documentaries. But in practice, that doesn’t happen very much.” But you will watch a half a billion hours of Adam Sandler comedies.
12. You can make your own dedicated Netflix button.
Hey, DIY-ers: with this 2015 schematic, you can create a one-button device that’ll dim lights, silence calls, order takeout and turn on Netflix all at once.
13. There are 13 great hacks you can do with Netflix (if you’re watching on a computer).
Well, there are actually a lot more, but we narrowed ‘em down to 13 — like watching a movie with a friend long-distance, getting movie recommendations from real-life people, uncovering secret categories or creating movie mixtapes.
14. They’re carrying a lot of debt. They don’t care.
The company has $20 billion in debts and liabilities. In response, Netflix noted that they have a equity market value of about $75 billion. Better than my credit rating.
15. Netflix’s House of Cards was the first online-only series to be nominated for an Emmy.
It was also the company’s first original series. HoC debuted on February 1, 2013. Based loosely on a BBC series of the same name (and a novel by Michael Dobbs) and co-produced by David Fincher, the show has now racked up 53 Emmy nominations and six wins.
16. Original programming is Netflix’s future.
They want to get it up to 50 percent of their offerings. And they’re more than happy to spend $7 billion next year to get there (HBO, meanwhile, will spend less than a third of that).
17. Netflix spends an estimated $543 per subscriber to attract new users.
It was less than $40 a decade ago.
18. Working there is tough. It’s not typical Silicon Valley. But it has perks.
Netflix’s famous 2009 corporate values report was literally entitled “Freedom & Responsibility.” An updated slide deck this year announced “Our version of the great workplace is not comprised of sushi lunches, great gyms, big offices or frequent parties. Our version of the great workplace is a dream team in pursuit of ambitious common goals, for which we spend heavily.” They also eschew brilliant jerks, only keep their top talent, call themselves a “team, not a family” and offer no set limits on expenses, vacation time or parental leave.
19. The worst movie on Netflix right now is …
The ridiculous, uniformly dishonest FIFA dramatization United Passions, which currently has a 0% on Rotten Tomatoes.
20. They’ve developed marijuana strains based on their most popular shows.
Netflix and chill, indeed. A little Camp Firewood (Wet Hot American Summer), Poussey Riot (Orange Is the New Black) or Prickly Muffin (BoJack Horseman), anyone?
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