I am sure a large part Netflix's success is how seamless its products are: there's minimal to no loading time and the video stream is virtually always smooth - including during times of action/high frame rate.
Creating a video streaming platform is one thing, but creating a content delivery platform that is effectively as reliable as TV that is also cost efficient is no small task if you ask me...
At this point it's a bit like arguing that Disney's great success in Bluray sales comes from their encoding/Bluray mastering expertise.
There is however something about that last 5-10% where moving a few bits around the right way gives you business advantage, over places like Disney.
That said, it does seem like some of this Netflix stuff is overbuilt, although I don't need to run tens of 1000's of ec2, so maybe it's worth it.