money & economicsWikipedia1997 · Scotts Valley, California, USA
Netflix started as a DVD-by-mail service after its founders tested the idea by mailing a disc to a house
Netflix was founded by Marc Randolph and Reed Hastings in Scotts Valley, California, on August 29, 1997, as a DVD rental service that shipped discs by mail. They chose DVDs after rejecting VHS as too expensive to stock and too fragile to ship, and tested the postal model by mailing a disc to Hastings's house, where it arrived intact. A monthly subscription replaced per-rental fees in 1999. The company's real goal, Hastings later said, was always streaming, and DVDs were a way to build a customer base. Netflix launched video streaming on January 16, 2007, with only about 1,000 films available, compared with around 70,000 on DVD. Streaming overtook DVD shipments in 2009, and by 2011 Netflix had become the largest source of internet streaming traffic in North America.
The shift from mailed discs to streaming reshaped how films and television are made and sold, and studios that once licensed old films to Netflix later became competitors. Hastings' long-term plan shows how a company can use an early business to fund a platform that did not yet exist.
Breaking Bad's audience grew sharply after Netflix began streaming earlier seasons, a pattern known as the Netflix effect.
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