2024-07-24 17:58:01
Netflix online video service economics/movies

via New York Times

Last week, a new contender entered the field with a radically

different approach to Internet movies: Netflix.

The company has done away with expiration

dates, copy protection and multi-megabyte downloads. That’s because

you don’t actually download any of Netflix’s movies; instead, they

“stream” in real time from the Internet to your computer.

Netflix has also done away with per-movie fees — in fact, there are

no additional fees for watching movies online at all. Instead, the

Netflix service is free if you’re already a Netflix DVD-by-mail


The hours of movie watching you get each month depends on which

DVD-by-mail plan you have. You get one hour of online movies per

dollar of your monthly fee. So if you pay $6 a month (for the

one-DVD-at-a-time plan), you can watch six hours of movies online; if

you pay $18 (for the three-DVD plan), you can gorge yourself on 18

hours of online movies. And so on.

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