Jeff argued that even if we offered streaming videos to Prime members at no additional cost, the business could still be profitable in the long run. (Long-term thinking = being Amazonian.) How? A streaming subscription service is a fixed-cost business. When Netflix licensed a movie or TV series from a studio, they paid a fixed fee. The amount was not based on usage. Netflix customers could watch the video once or ten million times, the costs were the same. Yes, there were some variable costs involved, for bandwidth and servers, but these costs amounted to pennies per view. And, as with most
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