(CTN News) – Netflix’s 238 million streaming customers around the world are probably unaware that the company first launched 25 years ago as a DVD mailing service that mailed DVDs to subscribers in their homes.
Under 1 million people are still subscribed to this service, even though most people are unaware that it has continued.
However, now the company is finally putting an end to its production by sending out its final discs to American customers on Friday, as its five remaining distribution centers in the US are running low on discs.
It has been announced that some DVD diehards will be allowed to keep these titles rather than returning them, which means that some will receive up to 10 DVDs as a goodbye present from a company that boasted as many as 16 million subscribers in its heyday.
As Marc Randolph, Netflix’s co-founder and the chief executive when the company shipped its first DVD, told Associated Press, the company’s first DVD shipment was bittersweet.
The miraculous thing is that this day did not come 15 years ago, even though we knew it was coming one day.
In its figures, Netflix does not break out the number of DVD subscribers, but according to an estimate made by the Associated Press, the number of DVD subscribers has fallen below one million in recent years.
It was Randolph who came up with the idea of a DVD-by-post service in 1997 in order to take on Blockbuster, the market leader at the time.
He collaborated with his friend and fellow entrepreneur, Reed Hastings, who eventually succeeded Randolph as CEO and became one of the company’s most important stakeholders. It was only this year that he stepped down from that position.
It was Tim Burton’s Beetlejuice that Netflix sent out on its very first disc in March 1998, and since then it has shipped more than 5.2 billion discs worldwide.
Its most popular title was The Blind Side, starring Sandra Bullock.
In spite of this, Randolph stated that he realized DVDs would not be the mainstay of the business and that internet viewing of films and television shows would eventually overtake DVDs.
Having rejected an opportunity to acquire Netflix for $50 million (£41 million) in 2000 instead of competing against it, Netflix decided to separate its DVD business from its streaming business in 2011. Streaming giant Netflix is now valued at approximately $166 billion.
It was evident from the beginning that DVDs were going away, that this was a transitory step. The DVD service performed this task admirably. Netflix was launched into orbit by an unsung booster rocket and then dropped back to earth after 25 years. That is quite impressive.”