Personally, I think Netflix should insulate itself by carefully splitting its DVD mail operations from its streaming operations. The two have completely different business models, as well as totally different, but severe business risks.
Either side could be wiped out “overnight” by changes in the law, yet the other could likely remain untouched. And while it’s very bad to lose half your company, it is far worse to lose it all.
As far as disk rentals go, there have been a surfeit of ill advised and authoritarian copyright efforts in the past, any of which could have ruined them, but there also seems to be no end to such efforts. Added to which is the precarious situation of the Post Office, and you have a high risk business.
Conversely, live streaming is even more fraught with risk. More than anything else right now, bandwidth providers are resentful of the very high demands placed on them by streaming movies. Their argument is legitimate: why should they pay millions so that Netflix can take advantage of their system?
Net neutrality, or the lack thereof, could change everything overnight. And Netflix streaming could be effectively over.
So again, it would be a smashing good idea for Netflix to legally, if not physically, have a division.
Yep, that could be very true in the near future (too near). Besides a majority of this country who do use computers STILL have dial-up as their only viable option, so streaming vids is just a far away dream for us. A good portion of Netflix catalog is not available for streaming, anyhow. We use Netflix by mail. Love it!
How is Netflix taking advantage of the ISPs?
They pay millions every month for their outbound bandwidth and Netflix customers pay millions every month for inbound bandwith. If the ISPs need to build up their infrastructure, then it should fall on the ISP’s customers. Netflix is already paying for big “pipes” at their end.
It isn’t Netflix’s problem that ISPs have consistently over-promised and under-delivered.