Tuesday, September 20th 2011
Customer Agony over Netflix's Price Rises & New Split Personality
Netflix's CEO, Reed Hastings, has apologized for mishandling a recent price increase that caused customers to fly away in droves. However, that was immediately drowned out by the decision to split the Netflix service into two, one with the odd name of Qwikster. The new streaming service will still be called Netflix and continue to have the same dedicated website as the old physical media one, netflix.com. However, the DVD rental service is now branded Qwikster, which will also have it's own site. Crucially, both sites will operate completely independently, which means separate logins and user profiles for each one, causing significant inconvenience to customers.To all intents and purposes, Qwikster will operate as a separate entity and even have it's own CEO, while being owned by parent company Netflix. This all appears to be a strategy to wean customers off the old physical media service and onto the new streaming one, although it instead appears to be doing a better job at alienating all its customers, who can find the kind of service they want from places like Amazon and iTunes. Once again, Hastings apologized for the inconvenience and said:
It remains to be seen how well Netflix does over the next year. However, they are very well established and streaming is the way forward, so I think they'll pull through. They should just remember it's their customers that keeps them in business and treat them well.
A longer version of this story is available over at Yahoo News.
Source:
Yahoo News
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.On top of this, the streaming service doesn't have anywhere near the same range of movies as the old DVD one, making customer retention a challenge. Unfortunately for Netflix, all this is taking its toll on the bottom line, with 600K customers fewer at the end of this month than at the end of June, by far the worst downturn the company has ever seen. This has wiped 53% off the company's stock value, which translates to around $8 Billion lost. The fact that Netflix were unable to renew a contract with a major supplier of movies, really isn't helping, either. Hastings has always steadfastly refused to rent video games. However, to help stem the tide, Hastings now wants to start renting these through the Qwikster service.
It remains to be seen how well Netflix does over the next year. However, they are very well established and streaming is the way forward, so I think they'll pull through. They should just remember it's their customers that keeps them in business and treat them well.
A longer version of this story is available over at Yahoo News.
72 Comments on Customer Agony over Netflix's Price Rises & New Split Personality
Either way, the sound quality is way bellow par to what you get from a BD uncompressed bitstream, I guess we're still years from getting real time uncompressed streaming over the net here in the US, it would wreak havoc on the current download caps imposed by ISPs, so don't count on Netflix streaming replacing your DVD and much BD collection any time soon :(
Ahh well there loss right :P :). Still enjoying using there streaming still although i am running out of stuff to watch but there is stuff on there for the kids which ends up better than paying $13 to comcast for basic channels which are crap anyways even more so for kids.
EDIT: I do as long as i use the the PS3 and on PC but limited to what your watching. Although only the PS3 selects miltichannel not the PC.
Anyway, I think the Oatmeal sums this up pretty nicely:
theoatmeal.com/comics/netflix
Either way, 60% is too much, and they lost my business. It just isn't worth these prices, period. Redbox and the free streaming services have most of the content I'm after, and ends up way cheaper for me than the new rates, at the cost of being slightly more inconvenient.
It's been fun Netflix :shadedshu
Netflix isn't some savior of the free world. The pirating argument is weak and pathetic as well. They pirate specifically because they don't have to pay for it. How in the hell is a paid service supposed to deter that? They pirate because it is FREE. Unless Netflix magically becomes free, you can forget about that entire demographic. That has always presented problems, and Netflix does not change that one iota.
And if they go under, yes, another service will take their place. Blockbuster, Vudu (very good for PPV, btw.) Amazon, and a whole slew of others are gearing up their streaming services. Some are PPV, and I'm sure some will become monthly soon to compete with Netflix.
And if they do go under, it's nobody's fault but their own.
want to take a TV series to a friends house to watch it? 8GB flash drive to their divX compatible DVD player is a shitton easier than taking boxes of DVD's and watching them get ruined.
stream/download it? hah, not on australian internet with bandwidth limits. i have to download freaking youtube files and watch them in MPC-HC, since thats faster than streaming them (for some reason, streaming speeds get slowed, direct downloads dont)
$8 for unlimited streaming is only worth it if they stock the shows you want in the quality you want, and you're already coughing up for the unlimited internet to go with it...
Now we have physical movie media problems: Most people would prefer to be able to download or stream movies straight to there house instead of going to a theater or to a rental place. All that equals is a customer demand that is not being filled. Netflix started to fill this demand at a very cheap price that is hurting A LOT of company's. Company's like Blockbuster or any theater. The demand is that a movie should be simultaneously released at a theater, and a rental store, and available for downloading/steaming at the same time. I heard rumor about a year or two ago that a movie was trying to do this but it didn't go through.What has blocked this from happening? People would pay for it. Physical media would suffer though, and so would theaters, and cable companies as well as company's that make or invest in blu rays and dvd's. Theater's and rental companies produce figures for the film industry so they can gauge how well a movie did. Plus the profit is insane from those places. I believe popcorn cost more per once than gold at a theater. So why would they block or attempt to stop that lol? The companies that Netflix had arrangements with saw that the did not charge Netflix nearly enough money for digital streaming rights and they had to be renewed. I doubt Netflix wanted us to pay for it but I imagine that the price for renewal was insane high. Starz stepped away from the table because Netflix would probably had to increase pricing again just to afford that and refused to pay what Starz demanded. You can thank the Lobbyists that are sent to Washington to block forward progress on this issue as they tried to do on the music industry as well. Which is also why site's like The PirateBay, Demoinoid and others thrive! :pimp:
And, again, redbox + the alternatives ends up cheaper per month for me. I can get more redbox movies a month than I was able to with the 2 at a time plan with Netflix. And the free alternative streaming sites offer everything I wanted off of Netflix streaming anyway. So why the hell should I keep it?
If all the movie\television studios embraced Netflix and Netflix then charged $15-20 a month but you could Stream ANYTHING, I would happily pay it. Instead, we got a million B-or-worse Movies, and a handful of seasons of good TV shows. It's currently at the point where Netflix was ahead of its time and will suffer because the support-structure for it's business are unwilling to change. Cable companies make infinitely more money from Advertising on their networks than they do through offering their content to Netflix, regardless of the price Netflix sets.