dvd by mail media service provider . for the algorithm competition see netflix prize . for the song see netflix song . netflix type public traded as nasdaq nflx founded august 29 1997 ; 19 years ago 1997 08 29 1 scotts valley california u.s. headquarters los gatos california united states area served worldwide except for mainland china crimea north korea and syria founder s reed hastings marc randolph key people reed hastings ceo ted sarandos cco industry entertainment products streaming media video on demand media service provider services film production film distribution television production revenue us 6.78 billion 2015 2 operating income us 305.8 million 2015 2 net income us 122.6 million 2015 2 total assets us 10.2 billion 2015 2 total equity us 2.22 billion 2015 2 owner reed hastings dominant shareholder 3 employees 3 500 2015 2 website netflix.com alexa rank 39 as of 5 october 2016 update 4 registration required users 83 million worldwide 47 million united states 5 current status active netflix inc. also known as netflix marketed and stylized as netflix is an american multinational entertainment company founded on august 29 1997 in scotts valley california 6 by reed hastings and marc randolph . it specializes in and provides streaming media and video on demand online and dvd by mail . in 2013 netflix added film and television production as well as online distribution . the company is currently headquartered in los gatos . in 1998 about a year after netflix s founding the company grew by starting in the dvd by mail business . 6 in 2007 netflix expanded its business with the introduction of streaming media while retaining the dvd and blu ray rental service . the company expanded internationally with streaming made available to canada in 2010 7 and continued growing its streaming service from there ; by january 2016 netflix was available in over 190 countries . 8 in 2013 netflix moved into the film and television industry with its first series being house of cards which debuted in the same year . it greatly expanded the production of both film and television series since then offering netflix original content through its online library of films and television . 9 netflix is releasing an estimated 126 original series or films in 2016 more than any other network or cable channel . 10 in july 2016 netflix reported over 83 million paid subscribers worldwide including more than 47 million in the united states . 5 contents 1 history 1.1 founding and establishment 1.2 membership fee acquisition for blockbuster growth start 1.3 video on demand introduction declining dvd sales global expansion 1.3.1 early netflix original content 1.4 entertainment dominance and presence and continued growth 1.5 server crash and awards ceremony 1.6 rebranding and vpn blockage 2 services 2.1 internet video streaming 2.1.1 history 2.2 disc rental 2.2.1 qwikster 2.3 profiles 2.3.1 reintroduction 3 products 4 content 4.1 netflix originals 4.2 film and television deals 5 device support 6 sales and marketing 7 international expansion 8 competitors 8.1 time warner 9 awards 10 finance and revenue 10.1 2010 10.2 2011 10.3 2014 10.4 2016 11 legal issues and controversies 12 user information 13 effects and legacy 14 see also 15 references 16 external links history edit further information timeline of netflix founding and establishment edit netflix headquarters in los gatos . netflix was founded on august 29 1997 in scotts valley california by marc randolph 11 12 and reed hastings both former employees at pure software . randolph was a co founder of microwarehouse a computer mail order company ; and was later employed by borland international as vice president of marketing . hastings a former math teacher had founded pure software recently selling it for 700 million . hastings invested 2.5 million in startup cash for netflix . 13 randolph initially had the idea to start a company that sold items over the internet but could not decide its objective . 14 netflix blossomed when hastings forcibly paid 40 in fines after returning apollo 13 well past deadline 15 though this story may be a tall tale created by hastings to explain netflix s business model . 16 netflix was launched on april 14 1998 17 with only 30 employees and 925 works available through the pay per rent model 50 us per rental via mail late fees applied . 18 membership fee acquisition for blockbuster growth start edit netflix introduced the monthly subscription concept in september 1999 19 and then dropped the single rental model in early 2000 . since that time the company has built its reputation on the business model of flat fee unlimited rentals without due dates late fees shipping and handling fees or per title rental fees . the original netflix logo used from 1997 to 2000 . netflix logo used from 2000 to 2014 in 2000 netflix offered to be acquired by blockbuster for 50 million but the offer was declined . 20 netflix initiated an initial public offering ipo on may 29 2002 selling 5.5 million shares of common stock at the price of us 15.00 per share . on june 14 2002 the company sold an additional 825 000 shares of common stock at the same price . after incurring substantial losses during its first few years netflix posted its first profit during fiscal year 2003 earning us 6.5 million profit on revenues of us 272 million . in 2005 35 000 different film titles were available and netflix shipped 1 million dvds out every day . 21 randolph a dominant producer and board member for netflix retired from the company in 2004 . 22 video on demand introduction declining dvd sales global expansion edit netflix developed and maintains an extensive personalized video recommendation system based on ratings and reviews by its customers . on october 1 2006 netflix offered a 1 000 000 prize to the first developer of a video recommendation algorithm that could beat its existing algorithm cinematch at predicting customer ratings by more than 10 % . 23 in february 2007 the company delivered its billionth dvd 24 and began to move away from its original core business model of dvds by introducing video on demand via the internet . netflix grew as dvd sales fell from 2006 to 2011 . 25 26 in january 2013 netflix reported that it had added two million united states customers during the fourth quarter of 2012 with a total of 27.1 million united states streaming customers and 29.4 million total streaming customers . in addition revenue was up 8 % to 945 million for the same period . 27 28 that number increased to 36.3 million subscribers 29.2 million in the united states in april 2013 . 29 as of september 2013 for that year s third quarter report netflix reported its total of global streaming subscribers at 40.4 million 31.2 million in the united states . 30 by the fourth quarter of 2013 netflix reported 33.1 million united states subscribers . 31 by september 2014 netflix had subscribers in over 40 countries with intentions of expanding their services in unreached countries . 32 early netflix original content edit netflix has played a prominent role in independent film distribution . through its division red envelope entertainment netflix licensed and distributed independent films such as born into brothels and sherrybaby . as of late 2006 red envelope entertainment also expanded into producing original content with filmmakers such as john waters . 33 netflix closed red envelope entertainment in 2008 in part to avoid competition with its studio partners . 34 35 entertainment dominance and presence and continued growth edit netflix has been one of the most successful dot com ventures . in september 2002 the new york times reported that at the time netflix mailed about 190 000 discs per day to its 670 000 monthly subscribers . 36 the company s published subscriber count increased from one million in the fourth quarter of 2002 to around 5.6 million at the end of the third quarter of 2006 to 14 million in march 2010 . netflix s early growth was fueled by the fast spread of dvd players in households ; in 2004 nearly two thirds of united states homes had a dvd player . netflix capitalized on the success of the dvd and its rapid expansion into united states homes integrating the potential of the internet and e commerce to provide services and catalogs that bricks and mortar retailers could not compete with . netflix also operates an online affiliate program which has helped to build online sales for dvd rentals . the company offers unlimited vacation time for salaried workers and allows employees to take any amount of their paychecks in stock options . 37 by 2010 netflix s streaming business had grown so quickly that within months the company had shifted from the fastest growing customer of the united states postal service s first class service to the largest source of internet streaming traffic in north america in the evening . in november it began offering a standalone streaming service separate from dvd rentals . 38 on september 18 2011 netflix announced its intentions to rebrand and restructure its dvd home media rental service as an independent subsidiary called qwikster separating dvd rental and streaming services . 39 40 41 andy rendich a 12 year netflix veteran was to be ceo of qwikster . qwikster would carry video games whereas netflix did not . 42 however in october 2011 netflix announced that it would retain its dvd service under the name netflix and would not in fact create qwikster for that purpose . 43 in april 2011 netflix had over 23 million subscribers in the united states and over 26 million worldwide . 44 but on october 24 netflix announced 800 000 unsubscribers in the united states during q3 2011 and more losses were expected in q4 2011 . albeit netflix s income jumped 63 % for q3 2011 . 45 46 year long the total digital revenue for netflix reached at least 1.5 billion . 47 on january 26 2012 netflix added 610 000 subscribers in the united states by the end of the fourth quarter of 2011 totaling 24.4 million united states subscribers for this time period . 48 opened netflix rental envelope containing a dvd of coach carter . in april 2012 netflix filed with the federal election commission fec to form a political action committee pac called flixpac . 49 politico referred to the pac based in los gatos california as another political tool with which to aggressively press a pro intellectual property anti video piracy agenda . 49 the hacktivist group anonymous called for a boycott of netflix following the news . 50 netflix spokesperson joris evers indicated that the pac was not set up to support the stop online piracy act sopa and the protect ip act pipa tweeting that the intent was to engage on issues like net neutrality bandwidth caps ubb and vppa . 51 52 on october 23 however netflix announced an 88 % decline in profits for the third quarter of the year . 53 server crash and awards ceremony edit on december 24 2012 around 1 00 p.m et numerous amazon web services servers crashed affecting countless services including netflix instant streaming . it lasted more than 20 hours . 54 55 in february 2013 netflix announced it would be hosting its own awards ceremony the flixies . 56 on march 13 2013 netflix announced a facebook implementation letting united states subscribers access watched by your friends and friends favorites by agreeing . 57 this was not legal until the video privacy protection act of 1988 was modified early 2013 . 58 rebranding and vpn blockage edit in april 2014 netflix approached 50 million global subscribers with a 32.3 % video streaming market share in the united states . netflix operated in a total of 41 countries around the world