Question

General description: This activity help students to link the concepts of innovation with business model and stakeholders

Required:

Select a disruptive innovation enterprise (e.g, digital enterprise such as; Talabat, Mobil Taxi, Netflix,…. etc) and describe in no more than 250 words its business model and expected parties or stakeholders involved in this business model.

Answer 1

Netflix started with that DVD rental business model. But Netflix innovated the idea of a subscription-based business model. As we know that we are paying for subscription pf traditional newspaper, magazines and journals for many years but Netflix monetized the business by applying an old business model to a new industry.

Netflix makes money with three types of plans,

• Basic
• Standard
• Premium

and give access to stream movies and shows of the peoples choice.

Netflix was not an overnight success as it moved out of the US in 2010 and now it has 182 million subscribers worldwide. Netflix is a profitable company and its profit is growing each year as more people are inclined towards it now and also they are attracting people by adding state of the art shows at Netflix. To give subscribers new and original content Netflix has to pay upfront to produce and licence the content so it has negative cash flow.

Netflix provides customers with world-class experience and thus attracts them like provide 24 hrs streaming with no adds, HD shows, Unlimited access to Netflix’s originals and other TV shows, Free trial of one month to the new subscriber.

Who are the stakeholders of Netflix?

1. Consumers
2. Suppliers
3. Media
4. Representatives
5. Distributors
6. Investors
7. Critics
8. Regulators