29 September 2016
The end of the property
Welcome to the on-demand world
Once upon a time there were the home videos, Blockbuster, the scheduled broadcast and the unmissable weekly date with your favorite TV series. Nowadays we have Netflix, the media company founded in 1997 in California that has effectively turned the video streaming into a popular practice. Nevertheless, in its early days, Netflix was a company dedicated to the distribution and the rental of those home videos that have now been supplanted by its new business.
The on-demand economy is the set of services created by companies to meet demand through a free or paid immediate service. The system was introduced by IBM in 2004 and is inspired by the concept of utilities, i.e. the cost of consumption.
Since 2005 the on-demand has spread throughout the information technology sector, especially in regard to software. In the business field, the on-demand identifies the charged and compulsory access to IT resources
The concept is simple and it is the one used by the sharing platforms: why should we buy an asset, if we will use it only for a very short time? Why can we not benefit immediately and only when we actually need it?
Waiting time and bad use experiences (in terms of efficiency and costs) have a shorter life when you can access the web or use a smartphone: this paves the way to a universe of services that need to be improved and made more accessible and smarter. And so did the digital disruptors: they have identified inefficiencies and redesigned the user experience. Airbnb applied this to the hospitality culture, Uber to the urban transport services, and different platforms like UpWork and Odesk to the freelance labor market.
Similarly, Netflix has realized the potential of the stream and made it a cheap but high quality experience: why should you waste time looking for a reliable Daredevil torrent when you can have a valuable and unlimited streaming for a small monthly fee?
In addition to this, through its ranking algorithm, Netflix learns a lot about consumers, studying their choices and the votes they express on products. In this way, Netflix learns to offer its customers movies and TV series that could please them. The customization level is very high, so that each customer has a different home page, customized according to specific preferences.
In the last half century, the idea of TV programme we have become familiar with is related to a fixed broadcast frequency: one episode per week. The idea was – of course – to fuel the tension, while trying to extend the potential of advertising revenue. Netflix has gone to the opposite direction: the full season is available and enjoyable, even in a one-day marathon. The audience has the absolute power to organize its experience at will. And the old Dionysian desire for instant gratification is so entirely satisfied.