The history of Netflix

Hollywood at Home Logo
Hollywood at Home is a weekly column by filmmaker, writer, and critic Keith Hodder that highlights the variety of films and television programs that Netflix has to offer, along with recommendations of what to watch next and his opinions on the world entertainment. Follow him @KeithHodder and feel free to suggest a film.

Netflix. It’s become a hobby, a binge-watching phenomenon, and as of recent, a meme. It’s the cellphone of the entertainment industry. Soon there will be a time where some of us forget what life was like without it. Soon there will be a generation that knew nothing of video rental stores and the exciting buzz of visiting one on a Friday night. After all, Netflix was the one to lay the practice of yesteryear to rest. The blood of Blockbuster is on their hands. Why do you think their logo and branding is brandished in ruby red? Some food for thought…

But Rome wasn’t built in a day. No, even the grandest of empires has the smallest of beginnings. Even Netflix had to come from nothing before it could become the company that could wield Kevin Spacey, Marvel Entertainment, and the magical ability to resurrect television properties like it was no one’s business. Yes, there was a time when people weren’t publically shamed for not subscribing to Netflix.

The idea started with Apollo 13 (1995). Reed Hastings, an American entrepreneur, had rented the film and forgot to return it. Much to his shame, he had amassed $40 in late fees that were owed to the video rental store. In fact, he had lost the cassette. It was in visiting a franchised gym to let off some steam and perhaps to pump away his late fee fears that the idea came to him – gyms charge a monthly fee, and whether the customer uses it frequently or not, the charge remains the same. The business model interested him, and it inspired him to launch a subscription-based and mail-in service called Netflix in 1999. This was back when people still thought physical media was the future. You remember DVDs, right? They were those shiny little discs that contained films and special features.

As the service grew to 300,000 subscribers by 2000, Netflix created the personalized recommendation system that the company is known for today. Finally, movie lovers were able to make Big Brother work for them. During that year, Hastings met with Blockbuster, offering them a 49% stake of his company for him to take on the online service behind In what is easily one of the saddest and unluckiest decisions since Pete Best got fired and was replaced by Ringo Starr in the Beatles, Blockbuster refused, launching their own online subscription service in 2004. This was the first nail in their coffin. By 2005, Netflix had earned over 4.2 million subscribers.

Like the characters in The Terminator franchise, there’s a date that we should all remember, a year that spawned the inevitable Judgment Day that brought an end to the world as we knew it. In 2007, Netflix launched their online streaming service in the United States. Come 2008 and into 2010, they partnered with various companies to stream content on a plethora of video game consoles, Blu-Ray disc players, and TV set-top boxes. 2010 also saw the service launch in Canada. Sure, the rights weren’t very good at the time, but since then, the amount of quality programs offered to us on home soil has grown.

In the past five years, Netflix has expanded to over 10 other countries. Over that time, and in 2013, Blockbuster called it quits. The king of the way movies were watched at home had fallen and at its funeral filmgoers cried, “The king is dead, long live the king.” Netflix claimed the throne and gave birth to a new era, one in which its citizens rarely leave home and contribute to the world as members of a productive society. But at least they can tell you what happened in the newest episode of Orange is the New Black. So, that’s something.

Speaking of that, the company has gone from a distributor of sorts, to a full-blown studio, creating original programing since their first Lilyhammer in 2012, which didn’t gain a significant amount of steam. It wasn’t until House of Cards and the Emmy nominations that followed, that revealed them as a significant force in the industry, catapulting them into television supremacy. Since then, more programming, much of it on par or better than Cards, has debuted to generous reception from viewers and critics alike. Due to their efforts, which include a slate of 25 original programs (not counting stand-up specials, documentaries, films, and series continuations), Netflix generated $4.7 billion in revenue last year.

What’s odd is, even though the company is now 19 years old, Netflix still seems like the young and pimply-faced member of the entertainment family. In many ways, it is. The rest of the family has gone grey. Film is over 100 years old; the first true movie theatre opened its doors in 1905, and physical home releases debuted in the ‘70s. Netflix is a teenager among these ranks, but with that said, they’re hitting a growth spurt. Not only are they debuting 37 other projects looking as far as 2018, which include Marvel’s Jessica Jones this year, Degrassi: Next Class, and Chelsea Handler’s own talk show in 2016, as highlights, but projections show increased profits for this year.

With that said, the future is looking good for Netflix. While they have no interest in exploring live sports and news, which Hastings sees as a dying practice, they hope to thrive in curated and controlled original content. Projections for 2016 show that your social life will continue to suffer.