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Alex Blatt, Vanessa Boys Smith, Drew Fann, Brie Hunt-Augustine, Chris Mullican.

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Presentation on theme: "Alex Blatt, Vanessa Boys Smith, Drew Fann, Brie Hunt-Augustine, Chris Mullican."— Presentation transcript:

1 Alex Blatt, Vanessa Boys Smith, Drew Fann, Brie Hunt-Augustine, Chris Mullican

2

3 Why Netflix? Integrated Customer Experience Good Cultural Fit Increased Market Share Streaming & Content Synergies

4 Apple TV – Not your typical TV Id like to create an integrated television set that is completely easy to use. It would be seamlessly synced with all of your devices and with iCloud. It will have the simplest user interface you could imagine. I finally cracked it. – Steve Jobs

5 Apple TV is Our New iOS Platform Leveraging our Next Portfolio Product integrated with iTunes and App Store = new monetization opportunities through capture of streaming market share New User Experience Fully integrated living room experience Deeper content relationship Leveraged synergies with a combined user base

6 In House: MacOSx iPhone, iPad, iPods Solid State Flash Storage Acquisition 2011 TV as Platform Integrated User Experience *Apple TV* Streaming Contracts AcquisitionNeed Vertical Integration Outcome Design Efficiency Production Cost Savings Distribution Efficiency Design Efficiency (Apple TV Integration) Production Cost Savings (Contracts) Distribution Efficiency (Streaming & Market Share) Competitive Edge

7 Movie Streaming on Apple TV: Capturing Market Share 23.8 million subscribers 22 million streaming

8 Pricing Model Basic Membership - $7.99 per month Premium Membership - $14.99 per month ConservativeYear Expected Millions

9 Comparative Value with sensitivity analysis

10 Added Value

11 Netflix current value Our OFFER $ 12.5 Billion Divested owners Joining 50%cash/ 50% 100% cashin Apple Stock

12 Current Value Chain Content & Services MobileMe iCloud Content Aggregation iTunes iBooks App Store Hardware & Software Platforms MacOSx iWorks Appliances Mac iPhone iPad iPod Apple TV Retail & Distribution Apple Store Telecom Competitor Hardware

13 Value Add: Vertical Integration Content & Services MobileMe iCloud Content Aggregation Netflix Streaming Technology iTunes iBooks App Store Hardware & Software Platforms MacOSx iWorks Appliances Mac iPhone iPad iPod Apple TV Retail & Distribution Apple Store Telecom

14 Apples Innovative Culture Do Everything Important Internally Make a Dent in the Universe Control the Message Get Marketing Love & Cherish the Creatives Values, not Rules Do What is Important Freedom & Flexibility Think Different Empower Employees to Make a Difference

15 Do Everything Important Internally Make a Dent in the Universe Control the Message Get Marketing Love & Cherish the Creatives Values, not Rules Do What is Important Freedom & Flexibility Think Different Empower Employees to Make a Difference

16 Apple-Netflix Integration Team Integration Change Management COMMUNICATION ORGANIZATION CULTURE Head of iTunes HR, Apple COO, NFLX HR NFLX Responsible for vision, direction and prioritization of all integration efforts CEO, NFLX R&D Apple TV Apple CEO

17 Integration Initiative CommunicationOrganizationCulture Facilitate integration effectiveness Align Apple and Netflix to increase efficiencies and realize synergies Minimize integration risks due to cultural differences Organize all stakeholders Establish 2-way feedback Launch internal communication campaign External PR Campaign Maximize stakeholder buy-in and involvement Set cross- organizational hierarchy Monitor retention rates Develop cultural transition strategy Deploy cultural progress surveys Put extra emphasis on gathering informal feedback Goals Actions

18 February | March |October | September Begin integration due diligence Feb 1 Begin integration due diligence Feb 1 Integration Team formed Feb 8 Integration Team formed Feb 8 Netflix is acquired Feb 1 Netflix is acquired Feb 1 Integration Completed September 1 Acquisition Timeline Communication Initiative launched Feb 8 Communication Initiative launched Feb 8 Set cross organizationa l hierarchy Feb 8 Set cross organizationa l hierarchy Feb 8 Monitor retention rates March 1 Monitor retention rates March 1 Maximize stakeholder buy- in and involvement March 1 Maximize stakeholder buy- in and involvement March 1 Deploy Cultural Progress Surveys March 1 Deploy Cultural Progress Surveys March 1 Gather informal feedback March - October Gather informal feedback March - October

19 Netflix Will Benefit from the Acquisition Fiscal Incentives Cultural Fit Competitive Positioning: Streaming Advantage & User Base Strategic Leveraging : AppleTV as a Platform

20 Summary Digital streaming experience unlike any other Netflix Digital Library & Subscribers Seamlessly Synced Apple Platforms & iCloud Service Now: #1 Digital Video Streaming Market Share Future: Streaming Content with Untapped Market Entry


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