Update: Netflix Scraps Qwikster DVD-only Service Idea
Dear Board of Chairmen at Netflix,
Last November, when you launched your $7.99 unlimited streaming plan, DVDs by mail was treated as a $2 add-on to your unlimited streaming plan. Since your July announcement of price increased and from when the new prices went into effect–Unlimited Streaming for $7.99 a month and/or 1 DVD at a time for $7.99 a month–you lost 1,000,000 subscribers. Your stocks now look like crap.
You then release a memo in your blog, “An Explanation and Some Reflections.” Your attempt to placate your obviously pissed-off customers went as follows:
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… When Netflix is evolving rapidly, however, I need to be extra-communicative. This is the key thing I got wrong.
This blog post was signed Reed Hastings, Co-Founder and CEO, Netflix. You should fire him, because he’s an idiot.
We don’t give a shit about the level of communication in announcing the separation of streaming and DVDs. We like streaming and would be willing to pay the increased fees if your service was more competitive than other services avaialbe. But you just lost your Starz contract and all the movies that went with it. Your streaming service is not “evolving;” it just got worse and you’re charging more for it, in the middle of an economic stagnation no less.
So for you to complicate the situation even more by announcing you will re-branding the DVD service to a separate website called “Qwikster” demonstrates a severe lack in ability to respond to consumer wants and needs. It’s like selling fruits and vegetables and then making another store with another name (but it’s a subsidiary!) to sell just the fruit. It doesn’t make sense for you or your customers.
You said in your blog, “Companies rarely die from moving too fast, and they frequently die from moving too slowly.” Well, companies also die from a common business practice known as “sucking at life.” Refer to Wikipedia’s List of Businesses that Failed, and be prepared when you join that list.
One business analyst compared your business plan to Apple’s iPod, suggesting that this business gamble will have long-term benefits for your profits. He’s also an idiot. The iPod is a technologically superior product in its field with aesthetics, durability, and easy to use feature. But streaming movies and TV shows is a pretty standard service that has competition coming from everywhere.
Also, next time you decide hike your prices, we’re going to remember your blog post and quote you: “There are no pricing changes (we’re done with that!)” “Done” with price increases? Really? For how long?
I guess as long as it takes for Redbox and Hulu to undercut you.
Your Pissed-off Customers
Netflix doesn’t have an e-mail address.
But you can call their customer service at: 1-866-716-0414
(Be nice to the techs, though. It’s not their fault.)
And you can write to them:
Netflix, Inc. 100 Winchester Circle
Los Gatos, CA 95032