Getting “Netflixed”

Getting “Netflixed”

net-flix  verb
1. to cause disruption or turmoil to an existing business model
2. to destroy a previously successful business model
3. to displace the way value is currently created, delivered, and captured

  • 1997: Reed Hastings returns Apollo 13 to Blockbuster six weeks overdue, and is dismayed by the $40 late fee
  • 1998: Reed Hastings founds Netflix with an alternate movie renting business model
  • 1999: Blockbuster valued at $4.8B
  • 2000: Blockbuster declines several offers to purchase Netflix for $50M
  • 2010: Blockbuster is valued at $24M, Netflix is valued $8.5B
  • 2011: Netflix nervous about missing the next business model  and get “Netflixed” commits the Qwikster Blunder

Forecasting information technology trends and consumer behavior is very difficult, even for those with insider information:

Due to technological interruptions and ever-changing customer expectations the IT business model will be different tomorrow than it is today. Steering your IT organization, “re-branding,” and cultivating the corresponding competencies is challenging. IT leaders have to understand the current IT operating model and define the future operating model required by their business partners. Then they have to set the strategy and develop the corresponding capabilities for the successful transformation. Otherwise they may get “Netflixed.”

Gartner has a great research note on IT operating models (Exploring the Future: Differentiating Competencies, Skills and Expertise in Four IT Futures, G00235700)

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