Netflix, Inc.: The Mouse Strikes Back

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Netflix, Inc.: The Mouse Strikes Back

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Publication Date:
August 23, 2019

Industry:
Media

Source:
Darden School of Business

In 2017, Disney announced that in 2019 it would launch Disney Plus, a subscription-based streaming video service that promised to rival Netflix, the dominant player in the market. This was the latest advancement in the history of movie rentals, which had first exploded in the 1980s with the advent of videotape and had gone through several technological transformations before reaching the age of streaming in the 2010s. At the time of Disney’s announcement, Netflix dominated the market due to its ever-improving algorithmic recommendation system and its investment in original content. How would Netflix withstand the competition from Disney? What would be an appropriate measure of relative strength for a streaming service? This case offers a way in to discussions of customer lifetime value, market capitalization, and discounted cash flows, as well as the role of technological change in business models and firm valuation techniques.

Copyright © 2020 Harvard Business School Publishing. All rights reserved. Harvard Business Publishing is an affiliate of Harvard Business School.

Netflix, Inc.: The Mouse Strikes Back

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