Netflix:

Company produces, delivers and sells a service or product to create value for its customers,
shareholders and other stakeholders. Netflix a pioneer in the online DVD subscription services operates
in the in-home entertainment video market. "In-home distribution channels include home video rental
and retail outlets, cable and satellite television, pay-per-view, VOD (video-on-demand), internet
streaming and broadcast television

Success Story Of Netflix:

Information System:
Information system used by Netflix is “Expert Systems and Neutral Networks.” An expert system, also
known as a knowledge-based system, is a computer system that is designed to analyze data and produce
recommendations, diagnosis and decisions that are controlled. A neutral system uses computers to
foster the way a human brain may process information, learn and remember that information.

Analysis Of System:
Netflix changed the video distribution from a store based rental channel to an online subscription based
distribution channel. The web-site enables "subscription account signup and management, personalized
movie merchandising, inventory optimization and customer support".Coupled with features such as
social networking (Friends) and queue management (Profiles) it compares each subscriber's movie
preferences derived from the individual's past ratings and rental patterns with preferences of other
users contained in the database and comes up with personalized movie recommendations unique to
each subscriber. The company leveraged on the power of Internet and technology to achieve two
purposes

(a) Enhance customer experience by providing them a web-based portal tailored to individual
preferences. It comes up with a customer specific recommendation list based on the individual's ratings
of past viewings. Customer's can set up their queues and receive delivery through mail. There is no
return deadline; no charges and the DVD's can be mailed back through pre-paid envelopes.

(b) Enhance operational efficiency - Traditional Video rental retail outlets would have to compromise on
the number of titles available in each of its stores because of space constraints. Netflix has an advantage
in being able to offer a much wider range of titles since the stock is piled in its warehouses. One of its
core business strengths is its vast catalogue of not so popular and old time movies and TV show content
which is cost effective to procure and profitable to sell, but is not available in conventional retail stores.

 But this system of Netflix has some flaws like ;The recommendation software purposefully omits
out-of-stock titles and hence influences the choice of the customer.
  It is intentionally slowing down delivery to high volume customers which are not so profitable.
Instead it gives a preference to the low volume members. Hence preferential treatment is given
to the more profitable low volume customers.

Cinematch also avoids suggesting out-of-stock movies and ensures maximum utilization of inventory. An
effective and comprehensive Information system enables it to distribute DVD's from the nearest
warehouse through US Mail. There are 100 shipping points across the United States which enables the
company to provide delivery in one business days for 97% of its customers.

Recommendations:
After analyzing all benefits of Netflix information system I recommend this to pioneer Pakistan by using
this pioneer will definitely touch the sky of success. As Netflix's information system personalized web
based movie selection services and technological innovations in the movie recommendation algorithm
are a huge entry barrier for new entrants. Although the software and technology is not hard to replicate
Netflix has the advantage of a database of over half a billion movie ratings and takes in more than a
million new ones every day. Pioneer itself is a very vast name in Pakistan but after adopting this system
it will have competitive advantage to its multi domestic competitors.