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Another significant move...


Another significant move was to strategically time the extension of its brand from film to precut CD-ROM and DVD-ROM music, blending a Napster-like discovery of music content with high fidelity and legal ownership. Even more significant was Netflix timing its alliance with broadband provider AOL-Time Warner to integrate its own customer base with other users of hybrid digital and DVD formats that were being targeted by AOL. This deal leveraged the Netflix expertise for proprietary predictive data mining technologies in entertainment. Extending movie and music labels into the household through hybrid physical and digital media caused explosive growth in profits by extending revenues into value added archival media.

Not surprisingly, Netflix recognized the opportunity of smaller artists to self-publish in DVDR format, leveraging the heuristic search engine technology that recognized musical patterns in database formats. Netflix extended their competency one last step by creating a publishing format for "books on disk" using natural text to speech technology. More critical was their ability to condense full length news print material to snippets using RDF technology, delivering business and technology news content in condensed formats, again not only through its weekly subscription model, but also in hybrid digital / DVD delivery format.


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