In the new office building of Netflix in San Jose.

Netflix's CEO Mark Randolph is looking at a plan, which is a plan for the future development of Netflix, in addition to the current Internet film and television rental business, there are two development plans for online video and Internet social networking.

This did not surprise him, because since the second half of last year, in the communication with Ronan, he has frequently heard him mention this content, and he has long been mentally prepared.

There was a knock on the door, and Ronan and Robert Iger walked in together.

Mark Randolph hurriedly greeted the two: "Morning, Ronan. Early, Bob. ”

Ronan and Robert Iger responded politely, then sat down on the couch and began to talk at work.

"Netflix has done very well last year. Ronan said directly: "I hope that Netflix can continue this momentum this year, and at the same time prepare to develop new businesses." ”

This aspect was planned before the acquisition of Netflix, and after Christmas, I exchanged views with Robert Iger, and then designated this initial development plan and brought it to Netflix for discussion.

Robert Iger said: "Netflix's business is relatively simple, and once the DVD industry fluctuates, Netflix will inevitably face huge risks. ”

Mark Randolph naturally wants to expand Netflix's business, but as the company's CEO, he must remain rational and say, "Netflix is just on the right track, isn't it a bit radical to expand its business now?"

Ronan smiled and said, "Mark, I know what you're worried about. This is just a plan, and it is a preliminary plan, and the next step must be market research, project inspection, internal research and detailed planning and other links, the real implementation and creation of the time is next year. ”

With a year to serve as a preparation period and a buffer period, Mark Randolph is confident.

"I'll do it in-house. He no longer hesitated: "Then set up a project team to promote the preliminary preparations." ”

Ronan nodded, and said: "Robert and I have done a special discussion based on market research data and the development of the Internet, the Internet video and download business is developing rapidly, just like the impact of DVD on the traditional videotape industry, it will have a huge impact on the DVD industry in ten years at most, and even bring about the decline of DVD." ”

Robert Iger added: "You know better than we do how fast the Internet is evolving, and Ronan made a vision that if there was a website that could directly provide HD online on-demand services, would Netflix's rental business continue to operate?"

While Internet video-on-demand isn't really ubiquitous due to hardware and bandwidth limitations, Mark Randolph has seen the industry grow at lightning speed, and it can change dramatically in five years, let alone a decade.

If you can sit in front of your computer and click on the video and watch a high-definition movie, who wants to wait for a day to receive a DVD and watch it?

Mark Randolph sensed a real threat, a danger that could bring Netflix's business to a dead end.

"This plan is very necessary. Marc Randolph said with all seriousness: "We can't wait until a new industry is already thriving, like Pepsi, and then it's too late. ”

Ronan pointed to the plan and said: "At present, there is no company on the Internet that specializes in video online business, we will go first, and we may be ahead step by step in the future." ”

Robert Iger continued: "The trail blazers are on a dangerous path, and if they succeed, they have a huge advantage. ”

Mark Randolph no longer has a problem with the Internet video business, and instead asks: "Internet social ......"

Ronan said simply: "You must be no stranger to this aspect, chat rooms, forums and blogs, these are the existing more mature online social carriers. Blogs, in particular, have almost changed the internet with their appearance. Our goal is to be a more concise, faster and faster online social media carrier with more sharing and dissemination speed than blogs. ”

Mark Randolph listened very carefully, through the contact of last year, he knew that Ronan was definitely a layman in the Internet industry at the technical level, but his vision and ability to judge market changes were more than excellent.

Ronan said that in 2002 there will be a huge development in the DVD industry, especially the film and television DVD, and this is indeed the case.

In 2002, DVD sales in the Hollywood film and television industry alone increased by more than 50 percent over the previous year.

In 2002, sales of DVD players increased by a factor of 1.5 compared to 2001, and the price dropped from nearly $500 a unit to less than $200!

This also allows DVD players to become more popular at a faster rate in the future.

Listening to Ronan's words, Mark Randolph nodded frequently, because what Ronan said can all be realized through the Internet, once realized......

The whole world will be changed!

Mark Randolph was excited, but calm enough, and the future seemed bright, but it was only the best idea, and it would take a lot of down-to-earth work to make it happen.

The stakes are also significant.

Ronan then said: "My vision is to build Netflix into a streaming company that integrates personal picture and video publishing, movie and TV video subscriptions, and online social networking and sharing!"

Mark Randolph and Robert Egger did not speak, but were both pondering Ronan's words.

The two thought of the same aspect, and once these things were realized, Netflix would become a giant in the Internet industry.

But the future is very good, and it is not easy to achieve it, and the difficulties and risks must also be taken into account.

Moreover, the plan is only a plan, and if you want to turn it into a field project, you must do enough preliminary investigation and market demonstration to verify that the plan does have the value of the input.

In the days that followed, Ronan and Robert Iger stayed in San Jose, meeting frequently with Netflix's top executives to discuss future plans.

It wasn't until the eve of the Golden Globes that the two took a flight back to Los Angeles together.

There weren't a few passengers in business class, and Robert Iger was still discussing the previous development plan with Ronan.

"Have you thought about it, Ronan. Robert Iger put it bluntly: "To get the plan done, Netflix will need a lot of money." ”

Ronan nodded and said, "I know." Now Netflix has a library of more than 23,000 film and TV series copyrights, and in terms of new dramas and new film production, with the support of Shahai Entertainment, there is no need to worry too much about the content, the real obstacle is undoubtedly funding. ”

Robert Iger also reminded: "I carefully studied social media such as blogs, and the upfront investment was very huge, but it was difficult to see an effective return, and funding was a problem that we had to solve. ”

Ronan had already thought about it and said, "Bob, what if you choose a suitable opportunity to let Netflix go public for financing?"

If you want to make Netflix a veritable Internet giant, it is impossible to do it with the power of Relativity Entertainment alone.

As a modern enterprise, Netflix is actually the best choice to go public and raise funds.

Robert Egger is a brilliant business manager and certainly doesn't object, reminding: "Choose a good time. ”

Ronan said seriously: "It's too early to say this, even if it goes public, it will have to wait for Netflix to build a framework that people can recognize." ”

Robert Iger nodded first, and then turned to say: "Ronan, have you thought about it, if the online video subscription business really develops and reaches the goals you planned, it may have a huge impact on the traditional film and television industry. ”

"It's possible. Ronan said with a smile: "But even if everything goes well, in a short period of time, Netflix will not be able to subvert the traditional film and television industry." Relativity Entertainment itself is a representative of the traditional film and television industry, and we must combine the possible advantages of Netflix in the future with the advantages of the film and television group, so that the two sides can effectively complement each other. ”

Advance payment to the traditional film and television industry is easy to say, where is it so easy to do.

The United States is better, even if it is boycotted by many Hollywood companies and directors like Spielberg like Netflix in the past, it can still develop relatively freely.

However, in many parts of the country, it is very difficult for Netflix to do business.

Take France, for example.

France has strict legal limits on how a film can be revealed on various platforms: from the time the film is released in theaters, it will be available on VOD platforms after 4 months, cable TV after 10 months, TVB after 22 months, and streaming platforms after 36 months.

Netflix is at the end of this chain.

The turmoil caused by Netflix is, in a sense, also a clash of two cultural values, a challenge to traditional media by the growing streaming platform.

The main reason is that there is a protection period between the release of a film in theaters and the launch of the Internet, and each country has different requirements for the length of the protection period.

For example, in European countries such as France, there is legislation on films, which determines that all blockbusters released in theaters will have a certain percentage of box office revenue paid in the form of film tax, and for Hollywood blockbusters, this tax rate is even higher.

All this income will be used to support the state for art films.

In the United States, there is no special tax on films to support artistic innovation, there is no government intervention, and all film and theater development is operated according to absolute commercial laws.

As a result, Netflix has caused much less resistance from theaters, industry, and politics in the United States.

In Ronan's last few years on the other side of the Pacific, the revenue capacity of many online movies and TV series has comprehensively surpassed that of traditional platforms such as cinema movies and television stations.

The knock-on effect of this can be imagined.

The road ahead is difficult, but Ronan has no intention of backing down, and if he wants to break the rule of traditional giants, he must use methods other than tradition.

As long as Netflix has enough paying subscribers, it can bring a new situation to Ronan.