Who really runs Netflix?
By Jaime Weinman - Tuesday, January 8, 2013 - 0 Comments
A Christmas Eve crash of Amazon Web Services blacked out Netflix
Amazon isn’t just the world’s biggest online retailer, one of its fastest-growing businesses lately is managing web storage for major online firms like Netflix. A lot of Netflix customers found that out the hard way on Christmas Eve, when Amazon Web Services (AWS) crashed, blacking out Netflix service for millions of Canadians and Americans at a peak time. Only a few weeks earlier, Netflix’s CEO Reed Hastings said he hoped to have Netflix entirely hosted on Amazon by the end of next year. Despite the glitch, he has made no move to end the relationship, and Amazon’s revenue from AWS—which, according to analysts, could soon be as much as $3 billion a year—seems safe. But people did notice that Amazon’s own rival service, Amazon Prime, was unaffected by the outage. Maybe it’s not a great idea to allow your biggest competitor to have so much power over your business.
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Prepare for TV chaos
By Chris Sorensen - Tuesday, June 7, 2011 at 10:15 AM - 4 Comments
As tech companies race to try to reinvent television, the industry is ready and fighting back
Mario Tama/Getty Images
A stock analyst once called Reed Hastings’s company, Netflix Inc., “a worthless piece of crap with really nice people.” That was six years ago. Hastings and his agreeable team have since helped kneecap video-rental giant Blockbuster by convincing Americans that it was easier to rent DVDs through Netflix’s website, and then have them delivered (and returned, postage paid) through the mail. Now Netflix is in the process of upending the entire television business by using the Internet to stream movies and TV shows directly to people’s computers and big-screen televisions via Web-connected Blu-ray players, Xboxes and other devices. So much for Mr. Nice Guy.
Netflix has so far signed up more than 24 million customers in the United States, rivalling the subscriber base of cable giant Comcast. Hastings expects to add another one million Canadian subscribers by this summer, with each one paying $7.99 a month for unlimited access to Netflix’s ballooning catalogue of digital titles. And the stock price? It’s far from worthless, having surged more than 800 per cent over the past five years—a better performance than even Apple Inc.’s.
Not surprisingly, cable and satellite TV executives are getting nervous—Comcast’s CEO recently derided Netflix as “reruns TV,” referring to its lack of live content. And Hastings isn’t doing much to soothe fears when he describes Netflix’s potential customer base as one that goes well beyond existing cable or satellite subscribers. “One way to think about the upper limit is the number of people who have a mobile phone,” Hastings told Maclean’s. “That’s because they’re people with enough money, and are of the right age to own a device with a screen.”
