Episode 307 - Netflix – The $150 Billion Mistake
Episode Stats
Words per Minute
165.74585
Summary
In today's Value Tainment, Patrick talks about a $150B mistake a company made many, many years ago, and how it led to Netflix going from being a $50M company in 2000 to a $147B company today.
Transcript
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30 seconds, one time for the underdog, ignition sequence start, let me see you put em up, reach
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the sky, turn the stars up above, cause it's one time for the underdog, one time for the
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I'm Patrick Bedevi, your host of Value Tainment, and in today's episode, we're going to talk
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about a $150 billion mistake that a company made many, many years ago.
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I want you to be thinking about two words, shifting habits, once again, shifting habits,
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but I'll come back to those two words here in a minute, so let me tell you this story
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about this company, it's 1984, a company gets started, it's got a yellow and a blue logo
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called Blockbuster, Blockbuster's a great story, you know, you'd go to Blockbuster with your
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girlfriend or your husband or your wife and say, you know, do you want to go to the horror
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No, no, maybe comedy, no, babe, we got to go to drama, and I'm telling you, babe, I almost,
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I'm certain this movie's not going to be available, but if it is, oh, it's our night
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tonight, you'd go, oh, I knew they didn't have it, why don't we go ask the manager, the
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manager may know, because maybe somebody just turned it in, hey, John, how are you, it's
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us, good to see you, John, did anybody by any chance turn in?
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No way, oh, you're so, John, you're always come through, thank you, they just dropped it
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off, oh, thank you, oh, that family right there dropped it off, it's so great, you guys are
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so amazing, let's take this movie, let's buy some popcorns and candy as well and ice cream
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and let's go on, that's 1984, they got started, by the way, most people don't realize, Blockbuster
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only after nine years was worth $8.4 billion in 1993, by 1997, a company got started called
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Netflix, it's only worth $50 million three years later, Netflix, $50 million three years
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later, okay, then at one point, Blockbuster could have bought Netflix for $50 million,
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but they said, I just don't think that's the direction consumers go into, I don't think
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they're going to shift their habits to this area, because people like the experience of
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coming to Blockbuster and actually seeing the DVDs they pick up, nobody wants to just
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download a movie, it's not going to be taking place, people are smarter than that, well,
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149 million users worldwide disagreed with them, and then Netflix went from being a $50
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million company in 2000 to today, as of just a few minutes ago when I checked, it's a $147
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billion company, by the way, Blockbuster on September 23rd, 2010 went out of business,
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they filed bankruptcy, I think like for $930 million and they're gone, so what's the moral
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of the story, well, Netflix, since Christmas, their stock is up 50%, 50%, just in 2019, in
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the first 19 days of the year, 19 days of the year, Netflix is up 35%, again, 35% Netflix
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is up, that's a love story for some, a horror story for a few, a fantasy type of story for
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others, and an obviously money-making story for those of us that were involved, now having
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said that, what do you mean by shifting habits, look, so many people want to be innovators
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and they want to, you know, shift their industry, oh my gosh, I want to be an innovator, I want
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to be a disruptor of my industry, look, Bezos shifted our habits, we stopped going to bookstores
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to buy books, because he said, I'm going to shift your habit of the way you buy books, that's
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why Walmart is afraid of Amazon, right, Instagram shifted our habits of the way we looked at albums,
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when's the last time you bought an album, and the list goes on and on, Google, Wikipedia,
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put encyclopedia companies out of business, how many times you go to Wikipedia to find
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out about different things, all the time, the moral of the story is this, Netflix shifted
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our habits, and I know, you know, Disney's about to come out with Disney flicks or whatever
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they want to call it, and I know one of the Disney executives said, you know, we're not really
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trying to compete with Netflix, we like Netflix, I use Netflix, we're just going to put out
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our Marvel products and Star Wars products and all this other stuff, but Netflix becomes
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the one that led the way, and no one even thinks about Redbox anymore, because Redbox
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at first made sense, and by the way, if you say, I still use Redbox, you're probably over
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40 years old, I'm not trying to offend you, but if you still use Redbox, you're over 40,
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you go to Kroger's, Ralph's, wherever it is to get your movies, look, stop trying to come
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up with a great idea, start thinking about shifting habits, not seven habits of highly
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effective people, shifting habits, how do people buy your product, how can you shift that
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habit, how do people buy the product from you, how can you shift that habit, and those who
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can become the Bezos, become the Zucks, become whatever you want to call it, of their industry,
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because they shifted someone's habit, that's all you got to be looking at, not all this
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other crazy fancy stuff, so by the way, will Facebook ever be put out of business, yes,
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by somebody who shifts our habit, and Zuck says, there's no way in the world that's the
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direction people are going to go to, and we'll go that direction, that could also happen to
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Amazon, and other companies, as long as a new innovator is able to shift our habit,
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food for thought, when you're thinking about growing your business, and taking it to the
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Thanks everybody for listening, and by the way, if you haven't already subscribed to
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Valuetainment on iTunes, please do so, give us a five star, write a review if you haven't
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already, and if you have any questions for me that you may have, you can always find me
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on Snapchat, Instagram, Facebook, or YouTube, just search my name, Patrick David, and I actually
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do respond back when you snap me, or send me a message on Instagram.
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With that being said, have a great day today, take care everybody, bye bye.