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Netflix: Job Killer. Job Creator.

By: Frank Yunker

Date: 2018-02-08

The Godfather
The Godfather

How has Netflix changed the home movie industry? Let's look at it from employment. After a movie got produced, someone had to make VHS copies. But how many? 1000? 1 million? And then they have to be distributed across the nation to every video rental store. New releases needed to be back in a day or two. Sometimes the video rental ran out. None left. Demand was important to calculate because supply was limited. Old movies could be rented for a week because demand was low. Some classics might have stored 2 or 3 copies instead of just one. Blockbuster hits meant more VHS tapes. New production runs for sleeper hits that suddenly became the "must-see" movie. So, the factory worker, the trucker, the video rental clerk. All of them had jobs.

With Netflix, you don't need the trucker. You don't need the factory worker to make copies. And you don't need the retail clerk. Sounds bad, but it's not. It's good for the economy... because consumers are getting more for less. In fact, there seems to be more movies getting produced (and due to the deteriorating culture... they are getting worse and worse quality). Still, consumers benefit, so the economy benefits.

This month, you can watch "The Godfather." All 3 in the series are available for Netflix streaming. Like VHS, you can pause the movie and when you return it will pick up where you left off. DVDs only did that if you did not remove the disc. VHS could be removed, stored on a shelf for a month and it would resume right where you left off. So, too, with Netflix.

We have a better product, delivered to your TV without the drive to the local video store. No shortages. Instant Access. And all of it delivered without employees. How can that be good for the economy? Don't we need workers?

Sure, but without workers, the price is lower. We can spend less in one month on Netflix for unlimited viewing that we would have for a once-a-week movie rental. We consumers end up with more money in our pocket. Then what? We spend it on frozen yogurt, video games, zip lines and a host of other products. So, maybe that video rental clerk is now a zip line clerk and the factory worker is now working a cash register at a yogurt shop. It's all good.