The global economy is undergoing structural changes that some are comparing to the transition from the agricultural to the industrial economy at the turn of the 19th century. An always-on international marketplace facilitates millions of commercial transactions every second, new ideas transform in to global industries with unprecedented speed, and new business models that were inconceivable at the turn of the century become mainstream practices; all underpinned by the explosive growth in digital communications.
This report, prepared by students of Curtin University’s Internet Commerce and Consumers course, looks at some of the key components of online commerce by analysing the business model, commercial practices and growth in popularity of American streaming video giant Netflix.
In coming articles, we will provide an overview of Internet commerce, and discuss how Netflix is situated with in the important attention, network and sharing economies. We will then further analyse Netflix by reviewing its history, business model and current market position. Finally, we will conclude with an overview of our findings; that while Netflix has been a highly successful and innovative ‘disruptive’ business, one which has leveraged the best affordances of the digital economy, the very success of its online strategy may in fact limit its growth by encouraging its competitors to seize opportunities in the market segment it pioneered.