Netflix CEO Says 'I Messed Up,' Announces Qwikster
Well, folks, looks like all of your hard work complaining about Netflix's new price plan has paid off. Netflix CEO Reed Hastings announced that the company will split its DVD and streaming options into two businesses plus rebrand its DVD division to win back the loyal, media-loving hearts that Netflix crushed. The new DVD service has been dubbed "Qwikster."
On Sunday Hastings blogged about the new Netflix business model, explaining what they're doing and why. He begins "An Explanation and Some Reflections" by admitting, "I messed up. I owe everyone an explanation." Below is a video of his apology plus a few snippets from his post.
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.
So we realized that streaming and DVD by mail are becoming two quite different businesses, with very different cost structures, different benefits that need to be marketed differently, and we need to let each grow and operate independently. It’s hard for me to write this after over 10 years of mailing DVDs with pride, but we think it is necessary and best: In a few weeks, we will rename our DVD by mail service to “Qwikster”.
Why "Qwikster?" Hastings explains, "We chose the name Qwikster because it refers to quick delivery. We will keep the name 'Netflix' for streaming." DVD subscribers will soon visit Qwikster.com for their media needs while streaming subscribers will continue to use Netflix.com.
There are no pricing changes (we’re done with that!). Members who subscribe to both services will have two entries on their credit card statements, one for Qwikster and one for Netflix. The total will be the same as the current charges.
Netflix stock has lost almost 50% of its value since it made the price announcement in July, according to Mashable.
Qwikster will be run as its own separate entity by Andy Rendich, formerly Netflix's chief service and operations officer. Netflix has named Rendich as the Qwikster CEO. The DVD mail service is expected to move to the new site in the next few weeks.
