At the end of the case, Netflix has come to a crossroads on how it should attack the current industry transition towards online video streaming. Their two main options were to partner with cable providers and offer their movie rating system or to integrate an online video library that allows their customers to access content instantly through the Internet. Furthermore, Netflix was also considering switching completely to a strictly online format.
Netflix's best long-tern strategy is to further develop its online video content and slowly begin to phase out its DVD operations. Reed Hastings realized nearly a decade ago that on-demand/online video content was the next step in the development of media storage and delivery. He was wise enough to invest millions towards a functional online model that is now serving millions of customers daily. With the emergence of high speed internet and the development of computers and hand-held devices (iPad, smart phones), customers can now access and enjoy Netflix's online library in seconds. By having their video content easily accessible and always available for viewing, Netflix can continue to develop their rating system in order to match customers with relatively unknown titles that are considered long-tail.
My roommate and I share the same Netflix account and the same Netflix DVD envelope (I don't even know what the movie inside is) has been sitting on our kitchen counter for over two months. Whenever I want to watch a movie or TV show, I just turn on my Xbox, use my iPhone, or use my laptop. The day where all media is stored in a digital format is not too far in the distance. Luckily for Netflix, they have taken the proper steps to maintain their position as an industry leader throughout this transition.
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