Netflix splitting DVD service, will add video games


I have to say, I haven’t been feeling the love from Netflix recently, I feel like they are trying to make money with their rash decision to up the DVD subscriptions and streaming subscriptions and now that they have had over 600,000 people unsubscribe they are now trying to rebrand. Maybe that’s just my opinion of it and they were actually trying to slowly make their way from raising prices to the eventual split and addition of video games. While all of that might bring in some new people…what about those that they pissed off. Like me! What are they doing for me?

Well apparently the CEO wants to apologies and explain why they upped the amount of money and it is because they are splitting the company in half, Netflix will remain as the online streaming division while the newly named Qwikster, will be its DVD division. The name is from the fact that they give their costumers quick delivery from the time they send it the DVD to the time it is in your mailbox. And they are no adding video games to their upgrades. Not a bad thing, you just have to pay for it.

I’m not entirely happy with this, one thing that bothers me is that I will now have two subscriptions from two separate companies. I guess it is in a way to try and get better deals with movie studios. But I don’t know, it is just a big pain and I feel it is very unnecessary. has the letter from the CEO:

Netflix to Split DVD Service into Qwikster, Add Video Games

Source: Netflix
September 19, 2011

Reed Hastings, co-founder and CEO of Netflix, and Andy Rendich, head of DVD operations, have announced that Netflix’s DVD mail service will be split off into its own brand called Qwikster and will add video games. We are guessing that this move is being made so that Netflix will be able to land better streaming deals with studios and networks.

Here’s a message from Hastings as well as a video of the two explaining the changes.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. Most companies that are great at something – like AOL dialup or Borders bookstores – do not become great at new things people want (streaming for us) because they are afraid to hurt their initial business. Eventually these companies realize their error of not focusing enough on the new thing, and then the company fights desperately and hopelessly to recover. Companies rarely die from moving too fast, and they frequently die from moving too slowly.

When Netflix is evolving rapidly, however, I need to be extra-communicative. This is the key thing I got wrong.

In hindsight, I slid into arrogance based upon past success. We have done very well for a long time by steadily improving our service, without doing much CEO communication. Inside Netflix I say, “Actions speak louder than words,” and we should just keep improving our service.

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. It wouldn’t have changed the price increase, but it would have been the right thing to do.

Read more: Netflix to Split DVD Service into Qwikster, Add Video Games –

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