Movies In Your Mailbox

Using the U.S. Postal Service isn't the only characteristic that qualifies Netflix as a Luddite company. Its distribution centers are decidedly low-tech, at least on the surface. At the San Jose center, employees sit at one set of desks in the morning to unpack and scan the bar codes on the packages of discs returned that day. Then they move en masse to another set of computers running specialized software that prints out address labels for the next subscribers. Tim Dillon, vice president of operations, says the company has chosen to concentrate on the software that tracks the 5 million discs in the Netflix system.

Hastings says the company is waiting for the day that digital distribution of films into homes becomes a reality. When that happens, he promises to transform the company from moving discs through the mail to movies over broadband. "That's why we named it Netflix, not DVD-by-Mail." But he thinks the broadband revolution will take at least 10 years. For now, Hastings and his crew are content to embrace what works, even if it looks as old-fashioned as some of the movie stars who watch silently over their distribution centers.

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