Justin’s blog post “Traditional TV Services Beating a Dead Horse “captured the essence of why Netflix is a valuable enterprise to investors and subscribers.

Justin is right that Netflix provides high incentives for users to use Netflix as a medium for entertainment, unlike other entertainment channels. House of Cards, a Netflix original, was incredibly successful. My testimony to this is that I watched all the 3 seasons of House of Cards in the span of a month.

House of Cards: One of the most successful Netflix Original Shows

The other insight from Justin’s blog post is Netflix’s brilliant use of the value proposition canvas. Netflix has been able to identify their customers’ job sectors, figure out customer pains, and then offer pain relievers. My greatest pain with TV channels is the commercials, which break my engagement, and prevent me from enjoying a show. Netflix’s ad-free service relieves this pain for me, allowing me to watch my favourite shows without interruption at a reasonable cost.

Netflix has recognized the importance of value addition where many other companies have not. The result is in Netflix achieving an enterprise value of 47 billion dollars. (As quoted from Justin’s blog.)