Netflix renames DVD-by-mail service ?Qwikster,? will add video games. Netflix’s DVD business: Does Qwikster have a future? Netflix announced in a blog post Sunday evening that its DVD-by-mail operations would soon be rebranded “Qwikster,” and that the service would be separated from the streaming service that the company has been pushing for the last several years.
Doing so clearly grants some independence to the unit, and will help it to operate without dealing with fast-growing streaming business. But it also raises questions about the future viability of a standalone DVD-by-mail operation. Netflix isn’t completely abandoning the new DVD business — at least, not yet. After all, Qwikster will have the same characteristic red envelope and the same legacy infrastructure and library supporting it.
However, it seems clear that Netflix is creating a wall between the two businesses as a way to smartly manage its profits and losses, and to help Wall Street better value the separate operations. An Explanation and Some Reflections. I messed up.
I owe everyone an explanation. It is clear from the feedback over the past two months that many members felt we lacked respect and humility in the way we announced the separation of DVD and streaming, and the price changes. That was certainly not our intent, and I offer my sincere apology. I’ll try to explain how this happened. For the past five years, my greatest fear at Netflix has been that we wouldn't make the leap from success in DVDs to success in streaming. When Netflix is evolving rapidly, however, I need to be extra-communicative. In hindsight, I slid into arrogance based upon past success.
But now I see that given the huge changes we have been recently making, I should have personally given a full justification to our members of why we are separating DVD and streaming, and charging for both. So here is what we are doing and why: Many members love our DVD service, as I do, because nearly every movie ever made is published on DVD, plus lots of TV series. Introduces New Plans and Announces Price Changes. Jessie Becker, here to share two significant changes at Netflix with you.
First, we are launching new DVD only plans. These plans offer our lowest prices ever for unlimited DVDs – only $7.99 a month for our 1 DVD out at-a-time plan and $11.99 a month for our 2 DVDs out at-a-time plan. By offering our lowest prices ever, we hope to provide great value to our current and future DVDs by mail members. New members can sign up for these plans by going to DVD.netflix.com.
Second, we are separating unlimited DVDs by mail and unlimited streaming into separate plans to better reflect the costs of each and to give our members a choice: a streaming only plan, a DVD only plan or the option to subscribe to both. Why Netflix changed its pricing plans. Netflix updated its pricing Tuesday, removing the ability to combine DVD-by-mail and streaming plans and effectively forcing subscribers to choose one or the other.
For those that wish to continue using both services, the change effectively raises the price of a combined plan by 60 percent, which has already caused some subscriber unrest on the blog post announcing the change and around the Internet. But why did Netflix make the change? Ultimately it comes down to money, as Netflix VP of Marketing Jessie Becker acknowledged in the company’s blog post. “Given the long life we think DVDs by mail will have, treating DVDs as a $2 add on to our unlimited streaming plan neither makes great financial sense nor satisfies people who just want DVDs,” she wrote. Netflix's Inevitable Split. Netflix announced this morning that it is changing its pricing structure for DVD and streaming videos.
Starting Sept.1, unlimited movie streaming and DVD-by-mail will be separate options costing $7.99 a month with the option of combining the two for $15.98 a month, or double what a standard Netflix subscription now costs. 'Dear Netflix': Price hike ignites social-media fire. While it's been a rough day for some Netflix users who partake of both online streaming and DVD-by-mail services with word of a 60 percent price hike , today has been downright bruising for Netflix itself.
The company is getting battered by irate users taking to social media to vent their red-envelope-tinged fury. Netflix's price increase for certain account types has many users saying they'll cancel in protest. Will you join them? On Netflix's Facebook page, just six hours after the company posted a link to the announcement that appeared on its company blog, more than 9,000 comments have been posted in response.
I read a sample of about 100 comments, and only one defended the Netflix decision. Related stories Netflix hikes prices, adds DVD-only plan ZDNet--Netflix's pricing backlash: Follow the money, churn rates "I can't believe the gall of a company raising what I can get today by over 60 percent! "