Netflix Ecosystem: an overview
An ecosystem is a network of components (products, services and platforms) that depend on each other and fuel each other to jointly deliver greater value. Netflix ecosystem comprises the companies it owns, content producers, competitors, customers, as well as, investors. Moreover, assisting infrastructure such as AWS cloud service, data centres, trade shows, banks and postal service are also components of Netflix ecosystem. All of the entities listed above are considered elements of ecosystem, because they contribute to the survival and well-being of the ecosystem.
Netflix ecosystem
Development of business ecosystem can be divided into four stages[1]:
1. Pioneering stage is where ecosystem is formed. For video streaming ecosystem pioneering stage is the second half of 2000s. Netflix invented DVD rental business model and it is one of the first companies that offered online video streaming service. Hong Kong based iTV was the company that introduced online video streaming for the first time, but Netflix was the first company that perfected this business model and made it successful.
2. Expansion stage. Currently, Netflix has 231 million paid memberships in over 190 countries with offices in over 25 countries.[2] The rapid expansion of the company during the last decade caused the expansion of online streaming ecosystem in general, motivating media companies to launch their own rival streaming services such as Disney+, HBO, Hulu and others.
3. Authority stage is when an ecosystem matures. It can be argued that Netflix ecosystem is approaching its authority stage with the global marketplace becoming highly saturated with international, as well as, local on-demand media providers. The video entertainment industry is becoming ready for yet another disruption.
4. Renewal or death stage. It is hard to estimate the time when Netflix ecosystem is going to be renewed or if it is going to cease to exist altogether due to the disruption of the industry. However, there are signs that increasing sophistication of artificial intelligence and big data may play an instrumental role in making this stage arrive sooner.
Netflix Inc. Report contains the above analysis of Netflix ecosystem. The report illustrates the application of the major analytical strategic frameworks in business studies such as SWOT, PESTEL, Porter’s Five Forces, Value Chain analysis, Ansoff Matrix and McKinsey 7S Model on Netflix. Moreover, the report contains analyses of Netflix leadership, business strategy, organizational structure and organizational culture. The report also comprises discussions of Netflix marketing strategy and addresses issues of corporate social responsibility.
[2] ESG Report (2022) Netflix Inc.