Ask anyone in the media industry and they’ll say that Netflix has had an impact. A few achievements:

• Deliver movies to your mailbox. Often times, more than once a week.
• Vast library of mainstream content and selective independent titles.
• Pioneer in paid online streaming.

At a time where most of the music business has gone digital and a vast number of people have mobile devices, Netflix has stuck to their core business of delivering movies. If you’re looking for an English language TV show or movie, there’s a good chance that Netflix has it.

However, the transition to digital has started. Although TV and films aren’t going away; digital is growing. And only a handful of companies are generating more revenue today than they did in the past. Netflix is one of them.

Netflix has some excellent opportunities on the horizon that could have a significant impact on how people consume content across multiple devices.

• TV: Netflix, through its partners, streams content to TV sets. While this is spread across a number of devices, the potential for growth is large.
• Mobile: With the release of the Apple iPad, the company released a streaming application for the device. According to Netflix CEO, Reed Hastings:
  

  In less than 60 days they created an amazing iPad application and it is only a beginning. The technical issues to expand from the iPad to the iPhone and iPod Touch are not material, but we’ll take a few months to get the user interface right for the smaller screen.

  This statement implies that Netflix is in the process of developing an application for Apple mobile devices, which currently command a significant share in the “full-browser” category. By introducing the Netflix app for the iPhone and iPod touch, Netflix will be able to market to nearly 75 million users at a fraction of what they pay today for customer acquisition ($21.54 as of Q1 2010).

• Streaming only: Netflix has been able to create a subscription model for premium content that is far superior to anything else offered today. Introducing a streaming-only model would reduce their costs and could improve margins in the future.

For Netflix, the possibilties are endless. And, its growth potential is large. A very strong buy.