Academic journal article Journal of the International Academy for Case Studies

The Rise and Fall of Netflix: What Happened and Where Will It Go from Here?

Academic journal article Journal of the International Academy for Case Studies

The Rise and Fall of Netflix: What Happened and Where Will It Go from Here?

Article excerpt

INSTRUCTORS' NOTES

CASE DESCRIPTION

The primary subject matter of this case concerns company analysis. Secondary issues include financial statement analysis, corporate strategy and international expansion. The case has a difficulty level of three and should be appropriate for undergraduate and graduate courses in investments and financial and strategic management. The case is designed to be taught in one to two class hours, with three hours of outside preparation by students.

CASE SYNOPSIS

Netflix is an innovative company that has changed the way we rent movies and watch TV shows. Its business model is based on a subscription service that provides home-delivery of DVD rentals and streaming of movies and TV shows. The company took advantage of the rapid growth in the DVD rental market, the internet and e-commerce by providing a service that the traditional brick-and-mortar retailers, such as Blockbuster, could not compete with. In 2011, however, a price hike, poor management decisions, changes in technology, and increased competition threatened Netflix, leading to a sharp decline in its share price. …

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