Netflix is an American subscription video on-demand over-the-top streaming television service. The service primarily distributes original and acquired films and television shows from various genres. It is available internationally in multiple languages.
Launched in 2007, nearly a decade after Netflix, Inc. began its pioneering DVD-by-mail movie rental service, Netflix is the most-subscribed video on demand global streaming media service, with 325 million paid memberships in more than 190 countries as of 2026. By 2022, "Netflix Original" productions accounted for half of its library in the United States and the namesake company had ventured into other categories, such as video game publishing of mobile games through its flagship service. As of 2026, Netflix is the 22nd most-visited website in the world, with 21.18% of its traffic coming from the US, followed by the United Kingdom at 6.01%, Canada at 4.94%, and Brazil at 4.24%.
Launch as a mail-based rental business (1997–2006)
Netflix was founded by Marc Randolph and Reed Hastings as a DVD rental service on August 29, 1997, in Scotts Valley, California.
Launched on April 14, 1998, Netflix offered a per-rental model for each DVD but introduced a monthly subscription concept in September 1999, after which the per-rental model was dropped by early 2000. In 2005, 35,000 different films were available, and Netflix shipped 1 million DVDs out every day.
Through its Red Envelope Entertainment division, Netflix licensed and distributed independent films such as Born into Brothels (2004) and Sherrybaby (2006). In late 2006, Red Envelope Entertainment also expanded into producing original content with filmmakers such as John Waters. Netflix closed Red Envelope Entertainment in 2008.
Transition to streaming services (2007–2012)
Hastings reportedly told Mynette Louie in the late-1990s that his goal was always streaming media, and that Netflix rented DVDs only to grow its customer base for streaming. By the mid-2000s, data speeds and bandwidth costs improved sufficiently, allowing customers to download movies from the internet. The original idea was a "Netflix box" that could download movies overnight and be ready to watch the next day. By 2005, Netflix had acquired movie rights and designed the box and service. But after witnessing how popular streaming services such as YouTube were despite the lack of high-definition content, the concept of using a hardware device was scrapped and replaced with a streaming concept.
On January 16, 2007, the company launched a streaming media service, introducing video on demand via the Internet. However, at that time, it only had 1,000 films available for streaming, compared to 70,000 available on DVD. The service, then called "Watch Now", at first required Internet Explorer on a computer. Hollywood studios (including 20th Century Fox, Sony Pictures, MGM, Paramount Pictures, Universal Pictures, Warner Bros., New Line Cinema, and Lionsgate) licensed second-run content to the service, not expecting it to threaten their existing lucrative relationships with cable television.
In February 2007, Netflix delivered its billionth DVD, a copy of Babel (2006) to a customer in Texas. In April 2007, Netflix recruited ReplayTV founder Anthony Wood, to build a "Netflix Player" that would allow streaming content to be played directly on a television rather than a desktop or laptop. Hastings eventually shut down the project to help encourage other hardware manufacturers to include built-in Netflix support, which would be spun off as the digital media player product Roku.
In January 2008, all rental-disc subscribers became entitled to unlimited streaming at no additional cost. This change came in response to the introduction of Hulu and to Apple's new video-rental services. In August 2008, the Netflix database was corrupted and the company was unable to ship DVDs to customers for three days, leading the company to move all its data to the Amazon Web Services cloud. In November 2008, Netflix began offering subscribers rentals on Blu-ray and discontinued its sale of used DVDs. In 2009, Netflix streams overtook its DVD shipments.
In January 2010, Netflix agreed with Warner Bros. to delay new release rentals to 28 days after the DVDs became available for sale, in an attempt to help studios sell physical copies, and similar deals involving Universal Pictures and 20th Century Fox were reached on April 9. In February 2010, Netflix signed a deal to stream 300 indie movie titles. In July 2010, Netflix signed a deal to stream movies of Relativity Media. It also announced an expansion of its deal with Warner Bros. Television adding more shows, including Veronica Mars and Nip/Tuck. In August 2010, Netflix reached a five-year deal worth nearly $1 billion to stream films from Paramount, Lionsgate, and Metro-Goldwyn-Mayer. The deal increased Netflix's annual spending fees, adding roughly $200 million per year. It spent $117 million in the first six months of 2010 on streaming, up from $31 million in 2009. In September 2010, Netflix launched in Canada, its first international market. In November 2010, Netflix began offering a standalone streaming service separate from DVD rentals.
In 2010, Netflix acquired the rights to Breaking Bad, produced by Sony Pictures Television, after the show's third season, at a point where original broadcaster AMC had expressed the possibility of canceling the show. Sony pushed Netflix to release Breaking Bad in time for the fourth season, which as a result, greatly expanded the show's audience on AMC due to new viewers binging on past episodes via Netflix, and doubling its viewership by the time of the fifth season. Breaking Bad is considered the first show to have this "Netflix effect".
In January 2011, Netflix announced agreements with several manufacturers to include branded Netflix buttons on the remote controls of devices compatible with the service, such as Blu-ray players. By May 2011, Netflix had become the largest source of Internet streaming traffic in North America, accounting for 30% of traffic during peak hours.
In July 2011, Netflix announced it would be separating its existing subscription plans into two: one covering the streaming and the other DVD rental services. The cost for streaming would be $7.99 per month, while DVD rental would start at the same price. In September 2011, Netflix expanded to countries in Latin America. That same month, 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. Customers reacted negatively, seeing this as a price increase and a betrayal of customer loyalty. Netflix's stock value dropped, and 800,000 of its 12 million customers cancelled their subscriptions. Netflix quickly apologized, and in October 2011, announced it would retain its DVD service under the name Netflix and that its streaming and DVD-rental plans would remain branded together.
On September 26, 2011, Netflix announced a content deal with DreamWorks Animation.
In October 2011, Netflix and The CW signed a multi-year output deal for its television shows. In January 2012, Netflix started its expansion to Europe, launching in the UK and Ireland. In February 2012, Netflix reached a multi-year agreement with The Weinstein Company. In March 2012, Netflix acquired the domain name DVD.com. By 2016, Netflix rebranded its DVD-by-mail service under the name DVD.com, A Netflix Company. In April 2012, Netflix filed with the Federal Election Commission (FEC) to form a political action committee (PAC) called FLIXPAC. Netflix spokesperson Joris Evers tweeted that the intent was to "engage on issues like net neutrality, bandwidth caps, UBB and VPPA". In June 2012, Netflix signed a deal with Open Road Films.
In August 2012, Netflix and The Weinstein Company signed a multi-year output deal for RADiUS-TWC films. In September 2012, Epix signed a five-year streaming deal with Netflix. For the initial two years of this agreement, first-run and back-catalog content from Epix was exclusive to Netflix. Epix films came to Netflix 90 days after premiering on Epix. These included films from Paramount, Metro-Goldwyn-Mayer, and Lionsgate.