On the news of Netflix acquiring Warner Bros, I’m reminded of how good Netflix has been at innovating their business model.

Over the past 27 years, their business model has changed multiple times and each evolution appears to be in direct response to the bottleneck of growth, from maintaining inventory of DVD to acquiring global streaming rights.

Year / Business Model / Bottleneck to Growth

1998 / Sell DVDs over the internet / Need to continually replenish DVD inventory,

1999-2006 / Rent DVDs over the internet / USPS delivery & return times

2007 / Stream movies over the internet / Acquiring US streaming rights to a massive library of movies

2009 / Start producing movies (Netflix Originals) / Number of subscribers watching Netflix Originals

2010-2012 / Global expansion; Canada, South America, Europe / Maintaining rights globally

2025 / Acquire Warner Bros Discovery