It's no secret that Blockbuster™ stores have closed, while Netflix™ is still growing. Both companies participated in the video rental business. Netflix evaluated the lifestyle needs of video customers, understanding that time, family, and work obligations called for more convenient methods to receive video entertainment. Netflix embraced the opportunity to utilize the Internet and smart TVs, to stream videos directly to customers. The company also managed to keep customer costs down, by passing along the savings it realized in labor. Blockbuster did not keep its eye on competitor movements, permitting Netflix to quickly capture video market share. In sizing up the situation, which external environment(s) probably had the least effect on Netflix's success?
A) Social environment
B) Competitive environment
C) Economic and legal environment
D) Technological environment

Question

Quizplus · Accepted Answer

The economic and legal environment had a relatively low impact on Netflix's success compared to the other three environments. While economic conditions can affect consumer spending habits, Netflix was able to keep its prices low and still gain market share. Additionally, legal regulations related to the video rental industry were generally not a major factor in Netflix's growth, although the company did face some challenges related to copyright and licensing agreements.

It's No Secret That Blockbuster™ Stores Have Closed, While Netflix™