Netflix's DVD Rental Business Is Still Profitable (fortune.com)

Netflix might be focusing on its streaming business, but the product that made its name is still alive -- and apparently well. From a report: The company's DVD.com DVD rental business has 3 million subscribers and generated a whopping $56 million in profit on just $99 million in revenue during the first quarter, CNBC is reporting. That staggering profit margin aside, Netflix's business has a wide selection of 100,000 DVDs, which easily overshadows the 5,600 streaming titles available on Netflix, according to the report. DVD.com's profitability might surprise some who moved on long ago from disc-based entertainment in the living room to streaming. Indeed, Netflix itself seemed to have moved on in 2011 when it split the DVD division from its now-core streaming operation. And whenever Netflix discusses its business, the company focuses on streaming and its place in the original content market rather than DVDs.

Comments

Re:And it will be for a long time

[syn3rg]

== DVD Annual Business ==
396M Gross
224M Net
56.6% Margin

== Streaming Annual Business ==
11.3B Gross
336M Net
3.0% Margin

I don't think the disk-based business is going anywhere: not only is it a significant portion of Netflix' overall profit, but their margins are what give it staying power.