ENGLISH: At the time, Netflix created a new business model by combining the powe
ID: 3848052 • Letter: E
Question
ENGLISH:
At the time, Netflix created a new business model by combining the power of the Internet and artificial intelligence with the postal mail infrastructure.
1-What were the competitive advantages of the Netflix business model?
2-What characteristics of the Netflix information system define it as a strategic information system?
In response to the challenge of Netflix, Blockbuster established a business model (Blockbuster.con) similar to that of Netflix to try (without much success) to face its competition. Blockbuster perfected this business model by offering its customers the possibility of returning the rented films without having to send them back by mail. Blockbuster.com customers could return the movies (which they received by mail) to the nearest Blockbuster store, where the return is immediately recorded in the company's information system. In this way the customer subscribed to Blockbuster.com received new films faster, because the return was not dependent on the mail.
3 - Was it affordable for Netflix to imitate this model?
4- What kind of competitive advantage did Blockbuster achieve with this modification of the business model?
5 - The YES of blockbuster became a strategic YES?
In response to the challenge of Blockbuster, Netflix perfected its business strategy using technological advances ("video-streaming") to meet the challenge of Blockbuster. Look for information about this new business strategy and comment on how it reinforced the strategic nature of Netflix IS.
6-What technological changes allowed Netflix to implement video-streaming services?
SPANISH:
En su momento, Netflix creó un modelo nuevo de negocios al combinar el poder de la Internet y de la inteligencia artificial con la infraestructura de correo postal.
1-¿Cuáles fueron las ventajas competitivas del modelo de negocios de Netflix?
2-¿Qué características del sistema de información de Netflix lo definen como un sistema de información estratégico?
Como respuesta al reto de Netflix, Blockbuster estableció un modelo de negocios (Blockbuster.con) similar al de Netflix para tratar (sin mucho éxito) de enfrentar su competencia. Blockbuster perfeccionó este modelo de negocios ofreciéndole a sus clientes la posibilidad de devolver las películas rentadas sin necesidad de enviarlas de regreso por correo. Los clientes de Blockbuster.com podían devolver las películas (que recibían por correo) en la tienda Blockbuster más cercana, donde la devolución se registra inmediatamente en el sistema de información de la compañía. De esta manera el cliente subscrito a Blockbuster.com recibía nuevas películas con más rapidez, pues la devolución no dependía del correo.
3- ¿Era costeable para Netflix imitar este modelo?
4- ¿Qué tipo de ventaja competitiva logró Blockbuster con esta modificación del modelo de negocios?
5- ¿Convirtió esto el SI de Blockbuster en un SI estratégico?
Como respuesta al reto de Blockbuster, Netflix perfecccionó su estrategia de negocios valiendose de avances tecnológicos ("video-streaming") para enfrentar el reto de Blockbuster. Busque información acerca de esa nueva estrategia de negocios y comente como reforzó el carácter estratégico del SI de Netflix.
6-¿Qué cambios tecnológicos permitieron a Netflix implementar los servicios de video-streaming?
Explanation / Answer
1. The Netflix combined the physical landlord model with the subscription and all you can eat models to allow customers to rent all the DVDs they could in a month for a flat fee. Customers were allowed to keep the DVDs for an unlimited period of time and were not subject to late fees. In return, customers agreed to pay a recurring monthly subscription fee. Netflix was able to overcome some of the weaknesses of the landlord model, by delivering DVDs through the mail.
Netflix was one of the first companies to successfully develop an online recommendations engine that helped customers find new movies and TV shows based on others that they had rated in the past. Netflix's recommendation engine was extremely innovative when it was first developed. Netflix created the concept of the movie queue, allowing customers to build a wish list of movies that they would like to watch in the future. Instead of the few thousand products that can be stocked at a normal retail store, online stores can stock hundreds of thousands of products and sell them to anyone, anywhere.
2. Information systems and technologies are a major enabling tool for firms to create new products and services, as well as entirely new business models. A business model describes how a company produces, delivers, and sells a product or service to create wealth. NetFlix, successfuly introduced new products, services, and business models apart from it's traditional brick-and-mortar existence, which made it both competitive and profitable.
3. No it was not possible for Netflix because it works on a subscription model and generate its revenue from the subcription rather than late fees like Blockbuster.
4. Netflix was one of the first companies to successfully develop an online recommendations engine that helped customers find new movies and TV shows based on others that they had rated in the past. Netflix's recommendation engine was extremely innovative when it was first developed. Netflix created the concept of the movie queue, allowing customers to build a wish list of movies that they would like to watch in the future. Instead of the few thousand products that can be stocked at a normal retail store, online stores can stock hundreds of thousands of products and sell them to anyone, anywhere.
6. Netflix uses video encoding pipeline runs EC2 Linux cloud instances. The elasticity of the cloud enables it to seamlessly scale up when more titles need to be processed, and scale down to free up resources. Netflix video processing applications don’t require any special hardware and can run on a number of EC2 instance types. Long processing jobs are divided into smaller tasks and parallelized to reduce end-to-end delay and local storage requirements.
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