Netflix Moat?

There was a comment on my Netflix post questioning the moat, here is my response:

Netflix has multiple moats:

• It has a network effect. Each movie has reviews from multiple users on it and Netflix shows you what percent your likes and dislikes correlate with that user. This is a tremendous help in picking movies and is exponentially better than what any competitor could start with because of its millions of users.
• Netflix has a great rating system where one can rate each movie they rent from 1 to 5 stars, Netflix then uses this to guess how you might rank other movies, in my experience and that of many people I've talked to it is never more than one star off. This is a great lead to finding movies and its algorithms are a lot better than Blockbuster's (I've used both).
• The Netflix user is not usually one who keeps the service based on its cheap price; rather the Netflix quality.

Some differences I've noticed with Netflix and Blockbuster Total Access include:

• The quantity of movies, Netflix just has a lot more movies than Blockbuster. It has over 70,000 titles from which to choose, this is a huge advantage for finding users that love movies that may not be available anywhere except Netflix.
• The quickness, if I wanted to I could receive a movie in the mail on Monday around noon, then have it in the mail by 3, so it would get mailed that day, on Tuesday I would get an e-mail saying they received the movie and they were sending the next on my queue. With Blockbuster there were usually three or four days in between.
• As before stated the network effect and ratings system is a huge advantage, for people that really like movies this community is great and I have seen a lot of reviewers with hundreds of reviews that love to show they could be a critic, they never leave Netflix based on price because this community is likely not available
• And customer service, I haven't dealt with either, but Netflix has been mentioned in numerous surveys as having among the best in the industry.

Finally, proof of Netflix's moat has been shown Wal-Mart spent a bunch of money trying to create its own Internet rental service, it just lost a bunch more money and ended up selling its customers to Netflix. The result of this was Amazon killing any thought it had of a movie rental business.

Also, Blockbuster has spent hundreds of millions of dollars in an attempt to break into the industry, pricing their plans lower than Netflix's and offering free movies at brick-and-mortar locations - they effectively leveraged their brick-and-mortar business in their vain attempt, no doubt killing a lot of margin - and still have just one-third of Netflix's market share, at a margin much lower than Netflix.

The problem with Netflix, currently, is in no way its moat or business it the overvaluation.