Netflix (NFLX)

Comprehensive Library of Titles.    We have well established relationships with major studios and distributors, enabling us to maintain a broad and deep selection of DVD titles. We also offer our subscribers access to a smaller library of titles available for streaming. Because of our scale, national footprint and Internet based subscription model, we believe that we can efficiently acquire and provide subscribers a broader selection of DVD titles than DVD rental outlets, DVD retailers, and cable, satellite and telecommunication providers. In addition, by providing both DVD and streaming content as part of the Netflix subscription, we are able to offer subscribers a uniquely comprehensive selection of movies for one low monthly price. To maximize our selection of DVD titles, we continuously add newly released DVD titles to our library. Our DVD library contains numerous copies of popular new releases, as well as many DVD titles that appeal to narrow audiences.

Personalized Merchandising.    We utilize various tools, including our proprietary recommendation service, to create a custom interface for each subscriber to effectively merchandise our library. Subscribers rate titles on our Web site, and our recommendation service compares these ratings to the database of ratings collected from our entire user base. For each subscriber, these comparisons are used to make predictions about specific titles the subscriber may enjoy. These predictions, along with other factors, are used to help merchandise titles to subscribers throughout the Web site. We believe that our recommendation service and our other merchandising practices allow us to create broad-based demand for our library and maximize utilization of our library.

Growing Scale.    We have achieved a level of scale in our business that provides many operational advantages. For example, we are able to cost effectively automate many of our shipping and receiving processes, helping to drive down costs while also providing a better, more consistent experience to our subscribers. Also, our growing scale, namely, our more than 10 million subscribers, provides what we believe to be a key strategic advantage as our business expands into the Internet delivery of content. We believe that this large installed base of subscribers positions us well to compete in the Internet delivery of content with companies that may have more recognizable names or more resources.

Convenience, Selection and Fast Delivery.    Subscribers can conveniently select titles by building and modifying a personalized queue of titles on our Web site. We create a unique experience for subscribers by serving pages on our Web site that are tailored to subscribers’ individual rental and ratings history. Based on each subscriber’s queue, we ship DVDs by first class mail. Subscribers return these DVDs to us in prepaid mailers. After receipt of returned DVDs, we mail our subscribers the next available DVD in their queue of selected titles. We have over 100,000 DVD titles to choose from, and our nationwide network of distribution centers allows us to offer fast delivery. In addition, we offer subscribers more than 12,000 streaming content choices that can be watched instantly without commercial interruption.

Comprehensive Library of Titles.    We have well established relationships with major studios and distributors, enabling us to maintain a broad and deep selection of DVD titles. We also offer our subscribers access to a smaller library of titles available for streaming. Because of our scale, national footprint and Internet based subscription model, we believe that we can efficiently acquire and provide subscribers a broader selection of DVD titles than DVD rental outlets, DVD retailers, and cable, satellite and telecommunication providers. In addition, by providing both DVD and streaming content as part of the Netflix subscription, we are able to offer subscribers a uniquely comprehensive selection of movies for one low monthly price. To maximize our selection of DVD titles, we continuously add newly released DVD titles to our library. Our DVD library contains numerous copies of popular new releases, as well as many DVD titles that appeal to narrow audiences.

Personalized Merchandising.    We utilize various tools, including our proprietary recommendation service, to create a custom interface for each subscriber to effectively merchandise our library. Subscribers rate titles on our Web site, and our recommendation service compares these ratings to the database of ratings collected from our entire user base. For each subscriber, these comparisons are used to make predictions about specific titles the subscriber may enjoy. These predictions, along with other factors, are used to help merchandise titles to subscribers throughout the Web site. We believe that our recommendation service and our other merchandising practices allow us to create broad-based demand for our library and maximize utilization of our library.

Growing Scale.    We have achieved a level of scale in our business that provides many operational advantages. For example, we are able to cost effectively automate many of our shipping and receiving processes, helping to drive down costs while also providing a better, more consistent experience to our subscribers. Also, our growing scale, namely, our more than 10 million subscribers, provides what we believe to be a key strategic advantage as our business expands into the Internet delivery of content. We believe that this large installed base of subscribers positions us well to compete in the Internet delivery of content with companies that may have more recognizable names or more resources.

Convenience, Selection and Fast Delivery.    Subscribers can conveniently select titles by building and modifying a personalized queue of titles on our Web site. We create a unique experience for subscribers by serving pages on our Web site that are tailored to subscribers’ individual rental and ratings history. Based on each subscriber’s queue, we ship DVDs by first class mail. Subscribers return these DVDs to us in prepaid mailers. After receipt of returned DVDs, we mail our subscribers the next available DVD in their queue of selected titles. We have over 100,000 DVD titles to choose from, and our nationwide network of distribution centers allows us to offer fast delivery. In addition, we offer subscribers more than 12,000 streaming content choices that can be watched instantly without commercial interruption.

Comprehensive Library of Titles.    We have well established relationships with major studios and distributors, enabling us to maintain a
broad and deep selection of DVD titles. We also offer our subscribers access to a smaller library of titles available for streaming. Because of our scale, national footprint and Internet based subscription model, we believe that we can efficiently
acquire and provide subscribers a broader selection of DVD titles than DVD rental outlets, DVD retailers, and cable, satellite and telecommunication providers. In addition, by providing both DVD and streaming content as part of the Netflix
subscription, we are able to offer subscribers a uniquely comprehensive selection of movies for one low monthly price. To maximize our selection of DVD titles, we continuously add newly released DVD titles to our library. Our DVD library contains
numerous copies of popular new releases, as well as many DVD titles that appeal to narrow audiences.

Personalized Merchandising.    We utilize various tools, including our proprietary recommendation service, to create a custom interface
for each subscriber to effectively merchandise our library. Subscribers rate titles on our Web site, and our recommendation service compares these ratings to the database of ratings collected from our entire user base. For each subscriber, these
comparisons are used to make predictions about specific titles the subscriber may enjoy. These predictions, along with other factors, are used to help merchandise titles to subscribers throughout the Web site. We believe that our recommendation
service and our other merchandising practices allow us to create broad-based demand for our library and maximize utilization of our library.

Growing Scale.    We have achieved a level of scale in our business that provides many operational advantages. For example, we are able
to cost effectively automate many of our shipping and receiving processes, helping to drive down costs while also providing a better, more consistent experience to our subscribers. Also, our growing scale, namely, our more than 10 million
subscribers, provides what we believe to be a key strategic advantage as our business expands into the Internet delivery of content. We believe that this large installed base of subscribers positions us well to compete in the Internet delivery of
content with companies that may have more recognizable names or more resources.

Convenience, Selection and Fast Delivery.    Subscribers can conveniently select titles by building and modifying a personalized queue of
titles on our Web site. We create a unique experience for subscribers by serving pages on our Web site that are tailored to subscribers’ individual rental and ratings history. Based on each subscriber’s queue, we ship DVDs by first class
mail. Subscribers return these DVDs to us in prepaid mailers. After receipt of returned DVDs, we mail our subscribers the next available DVD in their queue of selected titles. We have over 100,000 DVD titles to choose from, and our nationwide
network of distribution centers allows us to offer fast delivery. In addition, we offer subscribers more than 12,000 streaming content choices that can be watched instantly without commercial interruption.

Comprehensive Library of Titles.    We have well established relationships with major studios and distributors, enabling us to maintain a
broad and deep selection of DVD titles. We also offer our subscribers access to a smaller library of titles available for streaming. Because of our scale, national footprint and Internet based subscription model, we believe that we can efficiently
acquire and provide subscribers a broader selection of DVD titles than DVD rental outlets, DVD retailers, and cable, satellite and telecommunication providers. In addition, by providing both DVD and streaming content as part of the Netflix
subscription, we are able to offer subscribers a uniquely comprehensive selection of movies for one low monthly price. To maximize our selection of DVD titles, we continuously add newly released DVD titles to our library. Our DVD library contains
numerous copies of popular new releases, as well as many DVD titles that appeal to narrow audiences.

Personalized Merchandising.    We utilize various tools, including our proprietary recommendation service, to create a custom interface
for each subscriber to effectively merchandise our library. Subscribers rate titles on our Web site, and our recommendation service compares these ratings to the database of ratings collected from our entire user base. For each subscriber, these
comparisons are used to make predictions about specific titles the subscriber may enjoy. These predictions, along with other factors, are used to help merchandise titles to subscribers throughout the Web site. We believe that our recommendation
service and our other merchandising practices allow us to create broad-based demand for our library and maximize utilization of our library.

Growing Scale.    We have achieved a level of scale in our business that provides many operational advantages. For example, we are able
to cost effectively automate many of our shipping and receiving processes, helping to drive down costs while also providing a better, more consistent experience to our subscribers. Also, our growing scale, namely, our more than 10 million
subscribers, provides what we believe to be a key strategic advantage as our business expands into the Internet delivery of content. We believe that this large installed base of subscribers positions us well to compete in the Internet delivery of
content with companies that may have more recognizable names or more resources.

Convenience, Selection and Fast Delivery.    Subscribers can conveniently select titles by building and modifying a personalized queue of
titles on our Web site. We create a unique experience for subscribers by serving pages on our Web site that are tailored to subscribers’ individual rental and ratings history. Based on each subscriber’s queue, we ship DVDs by first class
mail. Subscribers return these DVDs to us in prepaid mailers. After receipt of returned DVDs, we mail our subscribers the next available DVD in their queue of selected titles. We have over 100,000 DVD titles to choose from, and our nationwide
network of distribution centers allows us to offer fast delivery. In addition, we offer subscribers more than 12,000 streaming content choices that can be watched instantly without commercial interruption.

Comprehensive Library of Titles.    We have well established relationships with major studios and distributors, enabling us to maintain a
broad and deep selection of DVD titles. We also offer our subscribers access to a smaller library of titles available for streaming. Because of our scale, national footprint and Internet based subscription model, we believe that we can efficiently
acquire and provide subscribers a broader selection of DVD titles than DVD rental outlets, DVD retailers, and cable, satellite and telecommunication providers. In addition, by providing both DVD and streaming content as part of the Netflix
subscription, we are able to offer subscribers a uniquely comprehensive selection of movies for one low monthly price. To maximize our selection of DVD titles, we continuously add newly released DVD titles to our library. Our DVD library contains
numerous copies of popular new releases, as well as many DVD titles that appeal to narrow audiences.

Personalized Merchandising.    We utilize various tools, including our proprietary recommendation service, to create a custom interface
for each subscriber to effectively merchandise our library. Subscribers rate titles on our Web site, and our recommendation service compares these ratings to the database of ratings collected from our entire user base. For each subscriber, these
comparisons are used to make predictions about specific titles the subscriber may enjoy. These predictions, along with other factors, are used to help merchandise titles to subscribers throughout the Web site. We believe that our recommendation
service and our other merchandising practices allow us to create broad-based demand for our library and maximize utilization of our library.

Growing Scale.    We have achieved a level of scale in our business that provides many operational advantages. For example, we are able
to cost effectively automate many of our shipping and receiving processes, helping to drive down costs while also providing a better, more consistent experience to our subscribers. Also, our growing scale, namely, our more than 10 million
subscribers, provides what we believe to be a key strategic advantage as our business expands into the Internet delivery of content. We believe that this large installed base of subscribers positions us well to compete in the Internet delivery of
content with companies that may have more recognizable names or more resources.

Convenience, Selection and Fast Delivery.    Subscribers can conveniently select titles by building and modifying a personalized queue of
titles on our Web site. We create a unique experience for subscribers by serving pages on our Web site that are tailored to subscribers’ individual rental and ratings history. Based on each subscriber’s queue, we ship DVDs by first class
mail. Subscribers return these DVDs to us in prepaid mailers. After receipt of returned DVDs, we mail our subscribers the next available DVD in their queue of selected titles. We have over 100,000 DVD titles to choose from, and our nationwide
network of distribution centers allows us to offer fast delivery. In addition, we offer subscribers more than 12,000 streaming content choices that can be watched instantly without commercial interruption.

Comprehensive Library of Titles.    We have developed strategic relationships with top studios and distributors, enabling us to establish and maintain a broad and deep selection of DVD titles. Since our service is available nationally, we believe that we can economically acquire and provide subscribers a broader selection of DVD titles than video rental outlets, video retailers, subscription channels, pay-per-view and VOD services. To maximize our selection of DVD titles, we continuously add newly released DVD titles to our library. Our DVD library contains numerous copies of popular new releases, as well as many DVD titles that appeal to narrow audiences.

Personalized Merchandising.    We utilize our proprietary recommendation service to create a custom interface for each subscriber to effectively merchandise our library. Subscribers rate titles on our Web site, and our recommendation service compares these ratings to the database of ratings collected from our entire user base. For each subscriber, these comparisons are used to make predictions about specific titles the subscriber may enjoy. These predictions are used to merchandise titles to subscribers throughout the Web site. As of December 31, 2007, we had approximately 2.0 billion movie ratings in our database. We believe that our recommendation service allows us to create broad-based demand for our library and maximize utilization of each DVD.

Scalable Business Model.    We believe that we have a scalable, low-cost business model designed to maximize our revenues and minimize our costs. As we continue to expand our subscriber base, we are able to leverage operational changes in a cost effective manner which further reduces our operating costs on a per subscriber basis. Such cost reductions include increased automation and vendor negotiating leverage. Subscribers’ prepaid monthly payments and the recurring nature of our subscription business provide working capital benefits and significant near-term revenue visibility. Our scalable infrastructure and online interface allow us to service our large and expanding subscriber base from a network of low-cost shipping centers.

Convenience, Selection and Fast Delivery.    Subscribers can conveniently select titles by building and modifying a personalized queue of titles on our Web site. We create a unique experience for subscribers by serving pages on our Web site that are tailored to subscribers’ individual rental and ratings history. Based on each subscriber’s queue, we ship DVDs by first class mail. Subscribers return these DVDs to us in prepaid mailers. After receipt of returned DVDs, we mail our subscribers the next available DVD in their queue of selected titles. We have approximately 90,000 DVD titles to choose from, and our nationwide network of distribution centers allows us to offer fast delivery. In addition, we offer subscribers the ability to watch movies instantly on their PCs and anticipate offering this feature on other Netflix-enabled consumer electronics devices.

Comprehensive Library of Titles.    We have developed strategic relationships with top studios and distributors, enabling us to establish
and maintain a broad and deep selection of DVD titles. Since our service is available nationally, we believe that we can economically acquire and provide subscribers a broader selection of DVD titles than video rental outlets, video retailers,
subscription channels, pay-per-view and VOD services. To maximize our selection of DVD titles, we continuously add newly released DVD titles to our library. Our DVD library contains numerous copies of popular new releases, as well as many DVD titles
that appeal to narrow audiences.

Personalized Merchandising.    We utilize our proprietary recommendation service to create a custom interface for each subscriber to
effectively merchandise our library. Subscribers rate titles on our Web site, and our recommendation service compares these ratings to the database of ratings collected from our entire user base. For each subscriber, these comparisons are used to
make predictions about specific titles the subscriber may enjoy. These predictions are used to merchandise titles to subscribers throughout the Web site. As of December 31, 2007, we had approximately 2.0 billion movie ratings in our database.
We believe that our recommendation service allows us to create broad-based demand for our library and maximize utilization of each DVD.

Scalable Business Model.    We believe that we have a scalable, low-cost business model designed to maximize our revenues and minimize
our costs. As we continue to expand our subscriber base, we are able to leverage operational changes in a cost effective manner which further reduces our operating costs on a per subscriber basis. Such cost reductions include increased automation
and vendor negotiating leverage. Subscribers’ prepaid monthly payments and the recurring nature of our subscription business provide working capital benefits and significant near-term revenue visibility. Our scalable infrastructure and online
interface allow us to service our large and expanding subscriber base from a network of low-cost shipping centers.

Convenience, Selection and Fast Delivery.    Subscribers can conveniently select titles by building and modifying a personalized queue of
titles on our Web site. We create a unique experience for subscribers by serving pages on our Web site that are tailored to subscribers’ individual rental and ratings history. Based on each subscriber’s queue, we ship DVDs by first class
mail. Subscribers return these DVDs to us in prepaid mailers. After receipt of returned DVDs, we mail our subscribers the next available DVD in their queue of selected titles. We have approximately 90,000 DVD titles to choose from, and our
nationwide network of distribution centers allows us to offer fast delivery. In addition, we offer subscribers the ability to watch movies instantly on their PCs and anticipate offering this feature on other Netflix-enabled consumer electronics
devices.

Comprehensive Library of Titles.    We have developed strategic relationships with top studios and distributors, enabling us to establish and maintain a broad and deep selection of DVD titles. Since our service is available nationally, we believe that we can economically acquire and provide subscribers a broader selection of DVD titles than video rental outlets, video retailers, subscription channels, pay-per-view and VOD services. To maximize our selection of DVD titles, we continuously add newly released DVD titles to our library. Our DVD library contains numerous copies of popular new releases, as well as many DVD titles that appeal to more select audiences. We currently offer more than 70,000 DVD titles and more than 1,000 titles available through our instant-viewing feature.

Personalized Merchandising.    We utilize our proprietary recommendation service to create a custom interface for each subscriber to effectively merchandise our library. Subscribers rate titles on our Web site, and our recommendation service compares these ratings to the database of ratings collected from our entire user base. For each visitor, these comparisons are used to make predictions about specific titles the visitor may enjoy. These predictions are used to merchandise titles to visitors throughout the Web site. As of December 31, 2006, we had approximately 1.7 billion movie ratings in our database. We believe that our recommendation service allows us to create demand for our entire library and maximize utilization of each DVD.

Scalable Business Model.    We believe that we have a scalable, low-cost business model designed to maximize our revenues and minimize our costs. As we continue to expand our subscriber base, we are able to leverage operational changes in a cost effective manner which further reduces our operating costs on a per subscriber basis. Such cost reductions include increased automation and vendor negotiating leverage. Subscribers’ prepaid monthly payments and the recurring nature of our subscription business provide working capital benefits and significant near-term revenue visibility. Our scalable infrastructure and online interface allow us to service our large and expanding subscriber base from a network of low-cost shipping centers.

Convenience, Selection and Fast Delivery.    Subscribers can conveniently select titles by building and modifying a personalized queue of titles on our Web site. We create a unique experience for subscribers because most pages on our Web site are tailored to individual selection and ratings history. Under our most popular service, subscribers can have up to three DVDs out at the same time with no due dates or late fees. Based on their queue, we send them available DVDs by U.S. mail that subscribers return to us in prepaid mailers. After receipt of returned DVDs, we mail subscribers the next available DVD in their queue of selected titles. We have over 70,000 DVD titles to choose from and our nationwide network of distribution centers allows us to offer fast delivery. In addition, in January of 2007, we introduced our instant-viewing feature which is being made available to subscribers in a phased roll-out.