Netflix recently announced Qwikster, the DVD delivery service part of Netflix, will no longer come to existence.
Netflix made several flip-flops this year which gave a 60 percent price hike for customers using the DVD service, and then later switched their DVD service to a new company called Qwikster. Now they decided not to use Qwikster at all.
As the dust is settling around the changes, the only big lasting effect is the price hike.
On Oct. 10, Netflix stated their new plan of action in an email to customers and on their blog.
[/media-credit]- In this Sept. 22, 2011, file photo, Netflix CEO Reed Hastings gestures during the Facebook f/8 conference in San Francisco. Hastings said Monday, Oct. 10, 2011, it’s abandoning its widely panned decision to separate its DVD-by-mail and Internet streaming accounts.
“It is clear that for many of our members two websites would make things more difficult, so we are going to keep Netflix as one place to go for streaming and DVDs,” Netflix said in an email. “This means no change: one website, one account, one password … in other words, no Qwikster.”
A Mashable.com article on Sept. 19 said Netflix stock dropped 42 percent since July when Netflix announced the price increase.
Netflix stock rose slightly since the announcement Monday, but emotions still run high among customers.
Steve Martin, a public relations major and Netflix subscriber, said the greatest disservice Netflix has given its customers is its lack of communication regarding the price increase and Qwikster.
“Businesses need to know how to manage change, and Netflix didn’t manage change in this situation,” Martin said. “Netflix didn’t communicate that change very well to their customers. Basically they said ‘you’re going to get the same thing, but it’s going to be more inconvenient to you.’ ”
When Qwikster was first announced, customers were unhappy. Other streaming services such as Blockbuster, Hulu and Amazon looked to capitalize on the situation. Blockbuster created a competition on Twitter for customers who were planning on leaving Netflix.
“The hashtag was ‘#goodbyenetflix’,” Martin said. “They said if you tweet why you’re leaving Netflix, the top three tweets will receive a free year of Blockbuster streaming. That was the reason I did the tweets, because I really felt like Netflix didn’t get their customers. If they don’t care about their core customers who use the envelope, do they care about me? I thought, let’s see if I can make it. It ended up helping Blockbuster and hurting Netflix at the same time, which is what Blockbuster wanted.
“If they could have acquired better content for their streaming service, they would have had something to take back to the customer,” Martin said. “They could have said ‘look, change is a good thing’, but that didn’t happen.”
Joshua Dunn, a film major from Spokane, Wash., said the film industry is making it difficult for Netflix to stream some movies because of decreasing box office numbers.
“People in the industry are aware that it’s happening, but they’re just really resistant to it,” Dunn said. “If they just start handing it over to Netflix, then that means people pay less and they won’t go and watch their movies. I think Netflix would like to add basically everything, but the fact is the film industry doesn’t want to do that and lose their leverage.”
Dunn said he feels Netflix will continue to offer DVDs as a large part of its service.
“I just really like Netflix because it has such an awesome instant play selection, and because I’m a film major I’m always looking for films that you can’t find even on Amazon,” Dunn said. “Sometimes there is stuff that you can’t even download illegally if you wanted. They have a lot higher selection of DVDs, and that’s why they’re not giving up yet.”
Netflix has a lot of ground to recover in a competitive business environment where many customers feel alienated.
“It will be interesting to see if Netflix can get back,” Martin said.
