With All Due Respect To Reed Hastings, The Netflix-Qwikster Split Sucks For Customers http://www.businessinsider.com/with-all-due-respect-to-reed-hastings-the-netflix-qwikster-split-sucks-for-customers-2011-9/comments en-us Wed, 31 Dec 1969 19:00:00 -0500 Fri, 11 Jul 2014 22:59:15 -0400 Henry Blodget http://www.businessinsider.com/c/4e94857b69beddd37c00002e Sara Tue, 11 Oct 2011 14:05:47 -0400 http://www.businessinsider.com/c/4e94857b69beddd37c00002e Not everyone can stream. If you want your customers to only come from large metro areas, then go 100% streaming. But outside the city limits, streaming movies have to buffer very minute or so. Since the streaming movie selection is go old, you need the DVD option to watch any new release. We had the dual option, but since we rarely ordered DVDs (and since most subscribers order only 2 per month), then Netflix was making money on us NOT using their services. They kept spinning the price increase as you get DVDs for only $2 extra on top of the regular service, BUT in reality, the DVD was the regular service and you got streaming for $2 on top of the DVDs. Nice way to twist the words. So, for $10 per month, we were ordering an average of 1 DVD every 3 months and streaming 3 videos. Now we've canceled and are using Redbox. instead. We have a huge library of old movies, and have Hulu for TV streaming, so I don't really need Netflix anymore, since they aren't customer friendly. http://www.businessinsider.com/c/4e7eab4a69bedd432e000026 Matthew Sun, 25 Sep 2011 00:17:14 -0400 http://www.businessinsider.com/c/4e7eab4a69bedd432e000026 Wow netflix, thanks for the apology...ever hear of the saying "To little, to late!"? And in the middle of your apology you let another bombshell drop. Now instead of the convenience of having my DVD queue and streaming options all in one website I have to now manage TWO websites and remember yet ANOTHER password for this Quikster B.S.! How about renaming the DVD site "Lamester" cause that's what you are! You need to fire whatever rookie ivy league jackass that came up with this lame duck idea! http://www.businessinsider.com/c/4e7e30a469beddc64c00000d Churl Sat, 24 Sep 2011 15:33:56 -0400 http://www.businessinsider.com/c/4e7e30a469beddc64c00000d Exactly. I kept the two until the billing and queue management became an issue. Streaming only for the near future... http://www.businessinsider.com/c/4e79b099eab8ea301500001b Chip Wed, 21 Sep 2011 05:38:33 -0400 http://www.businessinsider.com/c/4e79b099eab8ea301500001b US mail going to 5 days a week will diminish the DVD rental appeal - fewer DVDs possible per week. Netflix subscribers resent prices being raised by a millionaire in a time when most people hurting financially. Streaming offers mostly second rate movies. So where does that leave them. In the toilet. Bad short term decisions lead to long term disaster! http://www.businessinsider.com/c/4e788f0aecad04fb37000004 Marc Witz Tue, 20 Sep 2011 09:03:06 -0400 http://www.businessinsider.com/c/4e788f0aecad04fb37000004 Just a thought here, ISP's have been talking about (And from what I understand some do) charge you more for heavier use. So, streaming only will actually wind up costing you more if you stream a lot. True? Please correct me if I am wrong here. http://www.businessinsider.com/c/4e787aef6bb3f7a85400005b Avi Deitcher Tue, 20 Sep 2011 07:37:19 -0400 http://www.businessinsider.com/c/4e787aef6bb3f7a85400005b I think the split does not make sense. I would understand it if the DVD-by-mail were a viable long-term standalone business - i.e. if there were two separate businesses here, but he were concerned with the old suppressing the new - or if there were no connections between the customer base. But as you pointed out, the overlap is strong. I went into more detail at <a href="http://blog.atomicinc.com/2011/09/20/qwikflix-netster-whence-the-split-netflix-business/" target="_blank">http://blog.atomicinc.com/2011/09/20/qwikflix-netster-whence-the-split-netflix-business/</a> but essentially this is not one of those cases that the split makes sense @Ivan: I like your point about dressing it up for sale. It is far easier to split then sell rather than the other way around. http://www.businessinsider.com/c/4e7878f469beddc453000023 Warren Harris Tue, 20 Sep 2011 07:28:52 -0400 http://www.businessinsider.com/c/4e7878f469beddc453000023 Having been Netflix members for several years, we tolerated the outrageous price increase so we could have the option of ordering both Blu-Ray (or DVD) and have streaming as an option. Not a great deal, but acceptable. Until Netflix decides to become 2 companies and make managing our 2 different queues a royal pain in the ass. As a long-time Amazon.com Prime member and Affiliate, now we will be switching to their service. It was bad enough to be paying twice as much for the same amount of service (we can only watch so many movies anyway...) - but splitting it up was the final nail in the Netflix coffin for us. I closed our account yesterday. http://www.businessinsider.com/c/4e787685eab8ea984000004e TheFree_Lance Tue, 20 Sep 2011 07:18:29 -0400 http://www.businessinsider.com/c/4e787685eab8ea984000004e I'm no vid freak, but "HD streaming" is often no substitute for Blu-Ray. Full 1080p? Doubtful. 7.1 sound? I haven't seen/heard it. I have seen plenty of compression and freezing though. What I don't know is if studios want to kill off Blu-Ray rentals in order to force purchases at a higher price point (Costco's $10 bin is a treasure right now) and/or reinflate movie theaters as THE place for high-end viewing (at a "premium" price). The latter seems unlikely given the number of "all digital" theaters now out there with the same compression problems as the streams. Hanging onto the Netflix streaming side for now after canceling the discs, mostly for the kids. But they seem to use it less and less too. http://www.businessinsider.com/c/4e785d1b6bb3f7e33d000010 Good Idea Tue, 20 Sep 2011 05:30:03 -0400 http://www.businessinsider.com/c/4e785d1b6bb3f7e33d000010 That's a great name. Maybe not too late, you should email Reed Hastings. http://www.businessinsider.com/c/4e785c826bb3f74423000040 Studios are stupid Tue, 20 Sep 2011 05:27:30 -0400 http://www.businessinsider.com/c/4e785c826bb3f74423000040 The waiting period on DVDs was imposed by the studios. Many of the studios are locked into exclusivity by HBO and so Netflix cannot stream the moves. The ones that were with Starz are going away because Starz got greedy. So Netflix is playing the best hand that it can. Meanwhile, the studios are doing everything they can to drive viewers towards file sharing. http://www.businessinsider.com/c/4e781715eab8ea351e000027 Robs Tue, 20 Sep 2011 00:31:17 -0400 http://www.businessinsider.com/c/4e781715eab8ea351e000027 Netflix isn't any more expensive for DVDs by mail than before. Since they changed their price plan last month I actually pay $2 less a month for the same 2-at-a-time DVDs we've always got from Netflix, so for us the change has been a cost-saver. Thanks Netflix :) http://www.businessinsider.com/c/4e7801f46bb3f7b91b00000e pwb Mon, 19 Sep 2011 23:01:08 -0400 http://www.businessinsider.com/c/4e7801f46bb3f7b91b00000e Was Whitney Tilson right after all? http://www.businessinsider.com/c/4e78002aeab8eabd7f00000e pwb Mon, 19 Sep 2011 22:53:30 -0400 http://www.businessinsider.com/c/4e78002aeab8eabd7f00000e Gurley's theory makes no sense. The DVD, streaming and hybrid customers were already going to be split out without needing to actually chop up the company. Netflix's move seems very curious. I'm wondering if it will open up room for competition? Has anyone tried to provide a service whereby they literally have a bank of DVD players in a center somewhere and stream movies to customers from each player such that a DVD is only streaming to one customer at a time? Would that hold up in court? http://www.businessinsider.com/c/4e77c7926bb3f7242600001c dropped nflx for amzn Mon, 19 Sep 2011 18:52:02 -0400 http://www.businessinsider.com/c/4e77c7926bb3f7242600001c NFLX just made switching from Netflix to Amazon Prime a no-brainer for anyone who also shops at Amazon.com http://www.businessinsider.com/c/4e77bce46bb3f7711b000024 Dean Wormer Mon, 19 Sep 2011 18:06:28 -0400 http://www.businessinsider.com/c/4e77bce46bb3f7711b000024 If he wants to get to the next level he is gonna have to take on partners with the cable cos and/or studios. He won't get the content otherwise. This is a tee up for selling off part of one or both sides. http://www.businessinsider.com/c/4e779787ecad042c78000006 Jim Mon, 19 Sep 2011 15:27:03 -0400 http://www.businessinsider.com/c/4e779787ecad042c78000006 We signed up for the DVD service because of the wide selection (particularly in foreign films) and the convenience. Streaming is nice, but with recent content reductions, it's getting less attractive. The previously announced changes left our plan relatively unchanged as we were at the high end in DVDs out. There was no word on what this split will do to pricing. If Qwikster begins raising prices and we have to pay $8 for streaming the 1 in 30 movies we actually want to watch, we might end up abandoning both sides of the new Netflix. http://www.businessinsider.com/c/4e778f4eeab8ea352800002e Jeff V Mon, 19 Sep 2011 14:51:58 -0400 http://www.businessinsider.com/c/4e778f4eeab8ea352800002e @Allie Have you thought that Amazon Prime, Hulu, and Vudu's offerings are so great, because they aren't burdened by having to send physical DVDs? One of the points of this making good business sense, is that they can 'true up' on licensing costs, and make it easier to compete. This is a good thing for Netflix streaming. It will undeniably get better after shedding the cost of DVD subscribers, and the quickster brand can slowly wilt without tarnishing netflix. Reed Hastings is brilliant. As stated numerous times, this is not a consumer friendly move. It's a business friendly move (and a brilliant one in my book). http://www.businessinsider.com/c/4e777f9369bedd046a000042 Jonathan Mon, 19 Sep 2011 13:44:51 -0400 http://www.businessinsider.com/c/4e777f9369bedd046a000042 Netflix has no shield in the streaming business, where companies like Amazon can go after them on equal footing. They financially cannot compete against Amazon when it comes to scale of infrastructure, not even remotely close. Amazon gets to amplify the subsidization of its scale with the AWS service. Amazon avoided the DVD mailing business because of tax problems when it came to opening up many local distribution centers nationally. The streaming business doesn't have that artificial government liability. http://www.businessinsider.com/c/4e777a40eab8eade74000083 Streaming customer Mon, 19 Sep 2011 13:22:08 -0400 http://www.businessinsider.com/c/4e777a40eab8eade74000083 As a streaming-only customer I'm potentially thrilled with this split, for the reasons Gurley mentions. This is a bet on people like me. Streaming selection will improve, maybe dramatically. This is a GOOD thing. In fact, you'd kinda have to question the sanity of any streaming-only customer who isn't happy about this. http://www.businessinsider.com/c/4e7767d169bedd5547000009 David Gobel Mon, 19 Sep 2011 12:03:29 -0400 http://www.businessinsider.com/c/4e7767d169bedd5547000009 NOPOLOGY = NO SALE http://www.businessinsider.com/c/4e774cdd6bb3f76b3b000042 brandonthomas Mon, 19 Sep 2011 10:08:29 -0400 http://www.businessinsider.com/c/4e774cdd6bb3f76b3b000042 I use the netflix streaming side only. Whether its playing in the background or I'm watching it directly, I like having it as a part of my entertainment arsenal. This announcement doesn't really affect that aspect. I'm happy. However, one thing that will affect all of us is when internet providers (Cox, Comcast, Verizon etc.) start enforcing caps on data usage. That will slow down streaming and stunt the growth of streaming entertainment. That's what Netflix Hulu and the others need to concentrate on. Not spliting the company so people have to pay two bills. But we all know that there are other reasons for spliting the company that will not be disclosed until later. This Drama series gets 1 star! http://www.businessinsider.com/c/4e77414469bedd3a6c000042 Allie F. Mon, 19 Sep 2011 09:19:00 -0400 http://www.businessinsider.com/c/4e77414469bedd3a6c000042 Am dropping my DVD service today; and probably dropping the streaming as the Netflix content is the absolute worst!!!! Amazon Prime is great, so is Hulu Plus and Vudu. Netflis streaming has limited movies and very old TV shows, period. You don't raise prices when you have very bad product! This Reed Hastings needs to be fired! http://www.businessinsider.com/c/4e7740cf6bb3f7e526000048 Now I'm worried Mon, 19 Sep 2011 09:17:03 -0400 http://www.businessinsider.com/c/4e7740cf6bb3f7e526000048 When I first heard about the split I sold some of my stock. I thought it was rude the way they blind sided the customers without warning. I also thought that people were over reacting and after the dust settled they would realize it is still an incredible value compared to the other options. but now ! They made it so easy to drop half their service. Inconvient to use both ! and Quikster? How does that even remotely take advantage of there branding ? How about at least using QUIKFLIX instead ? http://www.businessinsider.com/c/4e773e7a69beddcc5e00001c Al Batross Mon, 19 Sep 2011 09:07:06 -0400 http://www.businessinsider.com/c/4e773e7a69beddcc5e00001c If Gurley is correct, is Netflix required to disclose (e.g., MD&A) the reason? It will be interesting to see what the company puts into its public filings (maybe an 8-K). Netflix is developing a real problem in terms of consumer perception. One doesn't think of Netflix anymore as providing recent, high demand, filmed entertainment content in a timely fashion. The best and newest content is generally not available on the streaming service (and is subject to a wait on the DVD service) - a supply problem. And Netflix's emphasis on streaming is occurring simultaneously with the imposition of carrier/ISP bandwidth caps (particularly on mobile devices) and related restrictions - a very significant distribution problem. http://www.businessinsider.com/c/4e7739956bb3f7de26000013 Ivan Mon, 19 Sep 2011 08:46:13 -0400 http://www.businessinsider.com/c/4e7739956bb3f7de26000013 You've already executed your own split, by dropping the DVD service. Why does this move, which doesn't affect the streaming service you have retained, motivate you to leave??? It's the DVD customers who should be put off by this move. http://www.businessinsider.com/c/4e77379d6bb3f74d1c00002f Nostatic Mon, 19 Sep 2011 08:37:49 -0400 http://www.businessinsider.com/c/4e77379d6bb3f74d1c00002f Absolutely agree. What is Netflix thinking? Are they even thinking? This boneheaded move only worsens the situation. I dropped the DVD service when they doubled prices, and this new strategy in no way wins me back. In fact, it makes me want to dump the streaming service, too. Despite Hastings' apology, I think the company is still making arrogant moves with no regard to customer satisfaction or benefits. This is an breathtakingly bad decision, as if the last one wasn't awful enough. Welcome in, Netflix competitors. http://www.businessinsider.com/c/4e77307b6bb3f7da7b000030 Totem Pole Mon, 19 Sep 2011 08:07:23 -0400 http://www.businessinsider.com/c/4e77307b6bb3f7da7b000030 Agreed that from a customer's point-of-view I feel like I get far less value from Netflix than before the split(s). And that means I will be looking elsewhere for alternatives? It's up to the competition now to step in and start drawing away the customers. I'm looking at you Google, Apple, etc... http://www.businessinsider.com/c/4e772754eab8eab76100001d Ivan Mon, 19 Sep 2011 07:28:20 -0400 http://www.businessinsider.com/c/4e772754eab8eab76100001d It's beginning to feel to me like Hastings is dressing up the company for sale. DVD is a dying rental medium, and is not attractive to buyers. Streaming is where almost all rental distribution will be in a few years, and having access to a large incumbent subscriber base could be attractive to many aspiring players in the space. It probably makes sense as a business matter if it doesn't further alienate existing subscribers. In this vein, Hastings email to subscribers seems to be ill-timed. http://www.businessinsider.com/c/4e7726d669bedd3220000044 robertholtz Mon, 19 Sep 2011 07:26:14 -0400 http://www.businessinsider.com/c/4e7726d669bedd3220000044 This change is nuts and they are going to regret it several times over.