[dragonwriter]

> Pardon me for being so naive, but why does Netflix have no competition in their market?

Are you talking about the mail-DVD-rentals-to-your-house market or the stream-video-over-the-internet market. Because they've got plenty of fairly direct competition in the latter and currently more significant market (Amazon, Hulu, and Redbox streaming services, among others) as well as plenty of close substitutes (e.g., cable/satellite TV services which include "On Demand" series and movies) , and, if not a lot of direct competiton in the former market, at a minimum a close substitutes in the form of pervasive rental outlets (particularly Redbox).