Tuesday, September 20, 2011
Hastings' Attempt to Save Face
Reed Hastings, CEO of Netflix, tried to rectify Netflix's bad publicity through a blog post saying, "I messed up, I owe everyone an explanation." With the recent separation of DVDs and streaming, Netflix saw a decrease in subscribers. Netflix separated these features and increased their prices by charging for each service instead of offering both services as a package. Many costumers were outraged with the change and lack of explanation, hence Netflix's loss of about a million customers in such a short period. Hastings wrote to apologize to customers for the lack of explanation and went on to explain that the services will be better as separate entities. He explained how the DVDs service will now be called Qwickster and streaming will remain as Netflix, both will also have their own websites and billing service. Oh, but there is nothing to be alarmed about, Hastings promises that prices will no longer change (they're done with that!)
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3 comments:
Netflix does this every few years, so it's nothing new, however, I think if they do it again, I might look elsewhere for a similar service.
I think the widespread public outrage over Netflix's moves is a bit overdramatic. Many people are saying they'll quit the service due to the 60 percent price increase -- that's only if you opt for both the DVD-by-mail AND the streaming service. I use only the streaming service and rarely if ever had a physical DVD mailed to me, so dropping that portion of the plan was no problem -- and my monthly charge didn't go up at all. Based on Facebook chatter I've seen, most people weren't aware of their options before they spoke out.
Loosing a million customers is never good for business.
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