2.

0 ANALYSIS ON NETFLIX COMPANY PERFORMANCE

Around the time when production company Netflix were established on years
1977, Netflix need to faced many competitors. Competition on Netflix’s two main
products which is video streaming and DVD by mail, these two product have their own
competitors. As for DVD by mail competitors is Blockbuster and Red-box which having a
market share of 16.9% and 45.5% respectively meanwhile Netflix only have 24.3%. For
video streaming which called virtual viral include Amazon, I-Tunes and cable TV
companies. Other indirect competitors which are providing of home entertainment like
cable television, other unofficial websites that also provide with movies like YouTube.

Despite having to compete mostly big production company, performance of

Netflix company seems not decrease but can be seen keep on increasing. The
increasing in the company’s performance can be seen when Netflix started by
introduced instant streaming in years of 2007. Netflix expended its business by
introducing this instant streaming. This kind of service that introduced to the world by
Netflix, bring a rapidly increase to the company’s performance as it slowly introduced
Netflix to many more people who before the introduced the instant streaming don’t even
know that the Netflix is existed. In another world, this alternative helps in bring more new
users.

By 2009, Netflix was offering a collection of 100,000 tittles on DVD and had 12.3
million subscribers. With the increasing in the subscribers, the company started to
expand internationally in September 2010 with making and offering streaming service in
Canada and as the start of streaming service in Canada the numbers of subscribers also
keep on increasing and the company decide to expended the service in Latin America,
United Kingdom, Ireland and many more countries in the Nordic countries. Based on the
performance of Netflix company that each day making higher profit with the increasing of
subscriber bring to the three more operating segments in the fourth quarter of 2011.

The Domestic streaming, International streaming and Domestic DVD. The

Domestic and International streaming segments derive revenues from monthly
subscription services consisting solely of streaming content. The Domestic DVD
segment derives revenues from monthly subscription services consisting solely of DVD-
by-mail. By end of 2012 the total revenue for Netflix reached at $3.6 billion a 12.6%
compared to 2011 results and it is estimated that Netflix will hit the revenue of $4.4
billion end of 2013. Netflix announced having over 40 million subscribers in its
shareholder letter of October 21, 2013. 31.09 million being domestic streaming, 9.19
million and 7.15 being international streaming and DVD delivery subscriptions
respectively. Netflix has been growing both financially and with ever increasing the
subscriber base from the start with a brief stumble in second half of 2011 when it
separated the DVD service to Quickster and increased prices for the subscription by
60% of which it bounced back and regained its stock value and lost subscriptions. By the
more existed competitors who offers the same service as the Netflix, Netflix performance
faced a little decreasing but with the efforts making by the all the staff in the Netflix
company which in 2012, Netflix taking another alternative to bring back the increasing in
the performance. Alternative that been taking by the company to faced their strong rivals
is by taken more of an active role as producer and distributor. By being a producer for
both film and television series, Netflix company able to come out with the best and
entertain film and drama as well as to that end, offers a variety of "Netflix Original"
content through its online library.

By January 2016, Netflix services operated in more than 190 countries. Netflix

released an estimated 126 original series and films in 2016. The series and films that
produce by the Netflix company attract people’s interest more than any other network or
cable channel. Other than that, the number of series and film also more than other big
competitors. There even having a saying that going out from the mouth of people which
is saying that only the best series and movie able to produce in Netflix. By that saying
that spread wild among people, more people keep going to Netflix whenever they want
to watch any series or film.

As of October 2020, Netflix had over 195 million paid subscriptions worldwide,

including 73 million in the United States. It is available worldwide except in the following
mainland China, Syria, North Korea, and Crimea. It was reported in 2020 that Netflix's
operating income is $1.2 billion. The company has offices in France, the United
Kingdom, Brazil, the Netherlands, India, Japan, and South Korea. Netflix is a member of
the Motion Picture Association (MPA), producing and distributing content from countries
all over the globe.

But in mid of 2019, performance of Netflix’s company faced the decreased in the
subscriber. The stock of the company going down about 15% after the company missed
the expectations subscriber or in an easy way to express is company don’t meet the goal
that they set also short interest is up 20% over the past month. This performance going
down as the company faced the biggest problem due to the cause of the company have
to paying more and more in the purpose to acquire new subscribers. The amount that
spend by company for marketing and streaming content spending risen highly compare
than in year of 2012. Even with all that spend of money the revenue and subscriber
growth is slowing. The production company Netflix then come out with new plans which
also will need the company to spend big bucks of money. To attract more subscriber,
Netflix come out by sign up with a big name of writers and producers to create original
content for the Netflix platform.

By sign up with those big name of writers and producers, with the hope the
original content will hit big also will bring to the increasing in the numbers of subscriber
turn out this kind of strategy also don’t give any affect to the increasing of the company
performance. All the strategy that were made by the company can be say going waste
and the increase in the demand increase only a little bit. The demand increase only a bit
when the company keeping the subscriber price low. As we all know that pricing have
the most power that has long been one of the major bull cases for the stock. With this
kind of argument that come out, the company of Netflix take another strategy by lowering
the price but the service is sticky enough that they’ll be able to raise prices in the future.