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Old March 29 2010, 01:40 AM   #38
Holdfast
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Re: long waits on Netflix

Temis the Vorta wrote: View Post
A better solution would be to just be upfront about this: have a points system so that Inglorious Basterds costs five points and Double Indemnity costs one, or whatever the correct proportion of value is. Why should they be shy about this? People will understand why a recent Hollywood release is worth much more than some old movie that's been on TV or some foreign flick nobody's heard of.
People would understand, but they won't like it. At least not as much as the simpler concept Netflix currently uses.

The behind-the-scenes demand management algorithms - rationing, effectively - allow Netflix to promise the world while delivering it country by country.

In other words, they're making enough money off the suckers, so who cares about an onery bitch like me?
I'm far too anglicised to put it so bluntly, but essentially this is probably accurate, from a business perspective.

This may change over time as their customer base matures
If by "matures," you mean "gets a clue," Netflix is safe. They will have enough clueless customers to earn them a hefty profit for the foreseeable future.
I think you're right, and they are indeed safe for now. If a competitor came along, operating along different lines (such as the points system you suggested), and took market share, then they'd have to respond. But from what I can tell, all the current competitors use the same model as Netflix.

Let's say you have one person on an account who goes though 15 DVDs per month. You add another person to that account and together, you go through 15 DVDs per month. Is the first case a high-volume user and the second, not nearly so much since each person is only getting 7.5 DVDs per month?

Even if Netflix treats both cases equally (and logically, they should), if the second person on that account only has a handful of titles in their queue, all of which are high demand, and Netflix has no choice but to send them something, will that override the throttling feature?
I suspect their algorithm for deciding these sort of questions must be pretty complex. The management of such a large logistical operation as Netflix would require some very finely-tuned JIT software. And even then, by their very nature, Just-In-Time operations are very sensititive to supply and demand shocks (viz. the Blockbuster effect mentioned upthread). Actually, to a JIT purist, the demand shock is actually a good thing, as it acts as a feedback, identifying inefficiencies, and allowing the protocol to be refined yet further.
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