Good position in the highly competitive and rapidly evolving domestic media entertainment industry; Strong credit protection measures; and Good cash flow generation. Dependence on decisions made by movie studios; and Potential for streaming and DVD rental businesses to decline due to new technologies. The ratings on Los Gatos, Calif.-based Netflix Inc. reflect Standard&Poor's Ratings Services' view that the company has transitioned its business from a DVD rental business to a streaming and DVD-by-mail business and has maintained a moderate financial profile while rapidly growing. Overall, we view the company's business risk profile as fair, reflecting its position in the highly competitive and rapidly evolving domestic media entertainment industry, its dependence on decisions made by movie studios, a growing
