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NETFLIX Free Resources
Yes, DVDs are an inventory dream
Yes, DVDs are an inventory dream over the bulky VHS tapes that are often in need of rewinding, but they are also more prone to get scratched being mailed all over the place than through walk-in rentals. Yes, Netflix has established revenue-sharing agreements through 80% of its titles, but it was Blockbuster that started that favorable industry trend and it is the one that commands the real bargaining power. Yes, Netflix is starting to build new distribution centers beyond its Bay Area stronghold to cut down on delivery times, but if business ever approaches profitability what's to stop the likes of Blockbuster, WalMart.com, and Amazon (Nasdaq: AMZN) from diving right in with lower overhead and a larger captive audience since they already have the infrastructure in place? There are no alternate happy endings here. Netflix will either die alone or suffer in the crowd. Los Gatos, we have a problem.
Online DVD rentailer Netflix Inc. said that its subscriber base grew 88 percent in last years fourth quarter to 857,000, up from 456,000 in the like year-ago period. The Los Gatos, Calif.-based company had estimated Dec. 4 that subscribers would number between 840,000 and 870,000.
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