Netflix has shipped a total of 5 billion DVDs to its customers since first sending out those iconic red envelopes 21 years ago. The milestone was announced by DVD.com, the Netflix subsidiary that is now responsible for the company’s physical disc subscriptions, on Twitter Monday.
Netflix began running a DVD-by-mail subscription service in March of 1998, and shipped its first billion DVDs by early 2007. The company launched its video streaming service soon after, offering it initially as an added bonus to DVD subscribers.
Four years later, Netflix proceeded split its DVD and internet subscription services into 2 separate subscription plans and businesses. Since then, the user base of the company’s DVD subscription service has steadily declined, from 14 million subscribers in 2011 to just 2.4 million subscribers at the end of the most recent fiscal quarter. The company ended that same quarter with more than 151 million paying streaming subscribers worldwide.
As the number of DVD subscribers declined, Netflix has also slowly dialed back infrastructure required to sustain this part of its business. At its peak, Netflix operated around 50 distribution hubs to ship DVDs across the U.S. (the DVD subscription plan never launched internationally). Last year, that number was down to just 17 hubs.
However, DVD subscriptions are still highly profitable for the company: In Q2 of 2019, physical disc shipments contributed close to $46 million in profits to the company’s bottom line. That sizable profit explains why the company is keeping the DVD mailing service up and running for the time being.
And in case you were wondering: The 5 billionth DVD shipped by Netflix was “Rocketman” — a movie that is currently not available on the company’s streaming service.