Abstract Science Construction’s business is in planning, developing and building road projects. The major of its clients are municipalities, city governments, and other public sector entities. While the bankruptcy rates for these clients is very low, when economic downturns happen, their ability to pay in a timely fashion also suffers. This leads to businesses such as Science Construction needing to take on additional debt and to find creative methods in order to stay afloat during times of recession. Methods such as selling accounts receivables at discounted rates and taking larger lines of credit through banks and other lending institutions are some of the ways organizations can remain viable when their cash inflows have turned into a trickle. Science Construction is asking the Turkish Courts to postpone their bankruptcy proceedings for a year while they attempt to restructure. Through this, suggestions such as forcing shareholders to pay their debt to the organization, gaining credi...
Netflix was founded in Scotts Valley, California, in August 1997 by Reed Hastings and March Randolph. The whole idea for the DVD by Mail business was born out of Hastings’ own personal frustration from paying $40 in late fees for a video he had forgotten to return to Blockbuster. Hastings’ was compelled to figure out a better way for consumers to experience what was then the new video format DVDs and began his quest to disrupt the traditional movie rental market and create a new industry. Madrigal, A. C. (2014)
Blockbuster execs couldn’t understand the Netflix value proposition. They thought movie or game rentals as impulse purchases and that the bricks and mortar model was better than having to sign up and wait to get something through the mail. Megan O'Neill (2011). Blockbuster began a rentals-by-mail and streaming service belatedly in order to fight against it competitors like Netflix but they didn't come on strong enough or soon enough. It was a battle between old technology and new technology, where new technology won out in the end.
Blockbuster execs couldn’t understand the Netflix value proposition. They thought movie or game rentals as impulse purchases and that the bricks and mortar model was better than having to sign up and wait to get something through the mail. Megan O'Neill (2011). Blockbuster began a rentals-by-mail and streaming service belatedly in order to fight against it competitors like Netflix but they didn't come on strong enough or soon enough. It was a battle between old technology and new technology, where new technology won out in the end.
Netflix started out as a DVD rentals-by-mail service and business has been booming ever since they introduced a streaming subscription service as well. Blockbuster isn't the only one feeling threatened by Netflix. Paid television services are also losing subscribers to the cheaper streaming site. Megan O'Neill (2011)
Meghan O’Neill (2011) noted that, in 2000, Blockbuster declined several offers to purchase Netflix for a mere $50 million." The offer was definitely not too bad for a company that was bringing in billions of dollars in revenue at that time. Blockbuster is certainly hitting themselves for not jumping at the offer, which may have seemed irrelevant and unimportant at the time.
Having a competitive advantage over an existing company like Blockbuster took good leadership and good entrepreneurial strategies. Fundamentally, Netflix executives understood that an emerging technology was rapidly taking the market by changing the delivery of movie rentals. Hastings developed a strategy of Internet streaming, convenient customer service, and a virtual organization to deliver it cheaply and flawlessly. John Doerr, a partner at the venture capital firm Kleiner Perkins, said “Reed was ahead of the technology curve, and completely changed the industry. Michael V. Copeland 2010.
In 2000, only few Americans had broadband and Hastings knew that renting video cassettes would soon yield to streaming movies over the Internet. Netflix developed a TV box that would stream movies that will require 16 hours of download time. Blockbuster also knew it was coming but would not take the plunge. Instead, they tried to beef up sales by expanding their stores into outlets for books, toys, and other merchandise. Michael V. Copeland 2010.
NetFlix made use of technology by applying strategies that avoid the burden of retail outlets by operating online. With only a few warehouses and offices, the company became a virtual organization with no retail stores and no sales employees.
Hastings used a monthly subscription that allows unlimited rentals and no late fees. Instead of renting movies, the focus is on providing a convenient service. To make it inviting to order movies online, NetFlix developed what is possibly the best software in the industry. At a time when most websites are a confusing mess, the website is a model of clean organization and intuitive clarity. Like most Web 2.0 sites, Netflix uses client responses to recommend movies for individual taste. They even offered a $1 million prize to anyone able to improve the rating system. Noren, E. (2013).
Identify and describe some of the technology innovations that Netflix was able to exploit and how these innovations contributed to competitive advantage.
Netflix is often used as an example of disruptive innovation. Using the LIRC and the internet, research the concept of “disruptive innovation” and then discuss how Netflix fits the model of disruptive innovation. Consider what role technology played in achieving the disruptive innovation that provided Netflix with a competitive advantage. Competitive advantage is related to service or good which can be offered with low price or special features (Investopedia, 2018). Usually the competitive advantage link to distinct innovations Regarding these details which include success components, we have here practical case study about Netflix.
Netflix has also been a big proponent of high dynamic range, which delivers richer colors and deeper blacks. The company now has more than 300 hours of HDR programming, but it says the challenge is to not make content only look good on high-end TVs. Everything Netflix makes and streams needs to be just as perfect whether you're watching on an iPhone X, a Galaxy S9 or an older, entry-level smartphone. (Investopedia, 2018)
When faster broadband and better video compression allowed YouTube and other Web 2.0 sites to erupt on the scene about 2005, Hastings realized that the time has come to cannibalize his DVD rental business in favor of streaming video. He also knew that developing a box was too limiting, and that an open-source approach would allow Netflix to distribute movies on TVs, DVD players, desk-top computers, mobile phones or almost any device. To help their customers give up DVDs, Netflix did the unthinkable and they gave away streaming movies and made it easy. Text: Bourgeois, D. T. (2014
Netflix has been doing well because of the involvement of advance technology. That's an area it has been perfecting in-house since 2010, when it became more than a simple mail-order DVD rental shop.
Regardless of how many shows or movies Netflix produces, it ensure that its 118 million subscribers watch them without issues no their geographical location or which smartphone they own or how fast their internet is. Netflix even recently re-encoded its entire catalog to produce the best possible picture using the smallest amount of bandwidth, which was made possible by an AI technology it developed called Dynamic Optimizer. Madrigal, A. C. (2014
With the involvement of Technology, the company is able to deliver content with "an enjoyable quality" at 750 Kbps, but last year it started using a new encoding framework that shrunk that to a mere 270 Kbps. In the real world, that means that if you have a 4GB data plan, you can watch 26 hours of Netflix per month, up from just 10 hours before. These improvements are especially important for developing regions where Netflix is trying to grow its business -- particularly in Africa, Southeast Asia and South America. Madrigal, A. C. (2014
Megan O'Neill (2011) https://www.businessinsider.com/how-netflix-bankrupted-and-destroyed-blockbuster-infographic-2011-3?IR=T,
Text: Bourgeois, D. T. (2014). Information Systems for Business and Beyond. Saylor.org. Licensed under Creative Commons (CC BY) Attribution.
Noren, E. (2013). Digital Business Models: Analysis of the Netflix Business Model. Retrieved May 22, 2016, from https://web.archive.org/web/20170407030229/http://www.digitalbusinessmodelguru.com/2013/01/analysis-of-netflix-business-model.html
Adhikari, V. K., Guo, Y., Hao, F., Varvello, M., Hilt, V., Steiner, M., & Zhang, Z. L. (2012). Unreeling netflix: Understanding and improving multi-cdn movie delivery. In INFOCOM, 2012 Proceedings IEEE (pp. 1620-1628). IEEE. http://www.hit.bme.hu/~jakab/edu/litr/CDN/NetFlix12.pdf
Madrigal, A. C. (2014). How Netflix Reverse Engineered Hollywood. Retrieved April 29, 2019, from http://www.theatlantic.com/technology/archive/2014/01/how-netflix-reverse-engineered-hollywood/282679/
Disruptive Innovation. (2012). Retrieved April 30, 2019, from http://www.claytonchristensen.com/key-concepts/
With the involvement of Technology, the company is able to deliver content with "an enjoyable quality" at 750 Kbps, but last year it started using a new encoding framework that shrunk that to a mere 270 Kbps. In the real world, that means that if you have a 4GB data plan, you can watch 26 hours of Netflix per month, up from just 10 hours before. These improvements are especially important for developing regions where Netflix is trying to grow its business -- particularly in Africa, Southeast Asia and South America. Madrigal, A. C. (2014
Megan O'Neill (2011) https://www.businessinsider.com/how-netflix-bankrupted-and-destroyed-blockbuster-infographic-2011-3?IR=T,
Text: Bourgeois, D. T. (2014). Information Systems for Business and Beyond. Saylor.org. Licensed under Creative Commons (CC BY) Attribution.
Noren, E. (2013). Digital Business Models: Analysis of the Netflix Business Model. Retrieved May 22, 2016, from https://web.archive.org/web/20170407030229/http://www.digitalbusinessmodelguru.com/2013/01/analysis-of-netflix-business-model.html
Adhikari, V. K., Guo, Y., Hao, F., Varvello, M., Hilt, V., Steiner, M., & Zhang, Z. L. (2012). Unreeling netflix: Understanding and improving multi-cdn movie delivery. In INFOCOM, 2012 Proceedings IEEE (pp. 1620-1628). IEEE. http://www.hit.bme.hu/~jakab/edu/litr/CDN/NetFlix12.pdf
Madrigal, A. C. (2014). How Netflix Reverse Engineered Hollywood. Retrieved April 29, 2019, from http://www.theatlantic.com/technology/archive/2014/01/how-netflix-reverse-engineered-hollywood/282679/
Disruptive Innovation. (2012). Retrieved April 30, 2019, from http://www.claytonchristensen.com/key-concepts/
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