MARK3336 Ch. 10 Video: Netflix Will Have To Be More Careful Raising Pricing

For streaming video companies, operating the web portal is an example of __________________ while royalties for each view is an example of ___________________.

*a fixed cost; a variable cost

In the past, Netflix's superior library of titles allowed the company to freely engage in value-based pricing. Now, other companies like Disney and Apple are posing a significant threat to Netflix's dominance. This may require Netflix to shift to a strategy of _________________.

*competition-based pricing

With the influx of highly competitive video streaming options, there is the credible threat of video streaming services becoming commodities. This has the effect of making demand for streaming video ________________.

*elastic

For Amazon, Disney, and Apple, streaming video is a small component of a big portfolio of businesses. This puts pressure on Netflix as it relies on streaming video entirely in order to _______________________.

*generate profits

If Netflix should want to charge a price premium for its streaming service, it would need to employ a __________________ strategy by adding content or features that others simply can't match.

*value-added