What is Your Deal, Netflix? If That is Your Real Name.

Photo Credit: Flickr user HackingNetflix

Almost a month ago now, Netflix users received the email that very nonchalantly informed them that they would be paying the same price for each of the now separate services they were offered only days before. This seemed at the time to be a very confusing and backhanded way of charging everyone double for nothing. Roaring was generally directed upward. People left Netflix. Things got weird.

Now early this morning, CEO Reed Hastings quickly upped the crazy ante. Those of us who enjoyed the dual nature of Netflix enough to just suck it up and pay double will now be thwarted as well. Netflix will now split into two companies, changing their namesake DVD-by-mail company into the horrifically named and misspelled Qwikster, while their relatively new (though incredibly popular) streaming service will keep the enormous name recognition.

They have made a big deal about keeping the envelopes red, completely missing the fact that color recognition (toddlers) is different than brand recognition (customers). Qwikster will be a completely separate company with a separate website, payment and CEO, and will now feature a seemingly out-of-nowhere option to add game rentals.

After finishing the email, you can watch a video (that unreally confirms that this is not a very strange joke) of the two CEO's sitting outside of a strip mall straight shootin' into the camera. Though none of these changes are fundamentally life-altering (and hopefully these gaffs are not permanent), his giddy eyes are certainly no more comforting that the work memo he emailed however many million people a month ago.

In fact, both these decisions seem so hasty and ill conceived that it's hard not to wonder if that smile that Reed Hastings has in the video comes from the fact that he's drunk. More evidence might be the fact that the CEO overlooked the fact that he should probably secure his Qwikster Twitter handle quickly. He didn't, and now some stoned Elmo lover is running away with all the interest.

Is it possible? Is this the beginning of the end for Netflix? Post it in the comments.

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By G. Topscher in Breaking on September 19, 2011 2:10 PM 0 Comments

Comments [rss]

Jeremy Ülrey

Huh? It's not a matter of which is better, it's about the necessity of splitting it into two separate companies. Besides, it doesn't matter how much Netflix "focuses on" their streaming. If a studio wants to retain the rights to their catalog and make their own profits there's nothing Netflix can do to change that... and in case you haven't been noticing, the content providers are leaving in droves. Does anyone seriously think that the reason Netflix's streaming options have been ho hum up until now is just because they've been spending too dog gone much money on postage costs? Even if that were true it would have been addressed with the splitting up of the streaming/mail-order into two separate packages. Wall St seems to think this is just a preliminary step in the long term plan of selling off the DVD rental part of the business altogether... which will probably be the death knell for Netflix unless they manage to land a whale and sign the entirety of a major studio's catalog, new releases and all. Nothing we've seen has indicated that's remotely likely.

Eduardo Sedillos

I agree with tylernol, streaming is in high demand these days. Some of us do not have the time watch a television program we might like. Netflix, Hulu, Crackle et cetera, they make it possible for some of us to finally finish Lost or catch up on Mad Men. Cheers to Streaming

tylernol

not at all. The DVD business has a different cost structure and is declining. They need to spin it off to focus on the streaming business, which is where the growth is.