Netflix introduces Qwikster, and its rapid decline

Netflix Chief Executive Officer Reed Hastings speaks during the launch of streaming internet subscription services for movies and television shows to televisions and computers in Canada, at a news conference in Toronto September 22, 2010Boy, am I sure glad I dropped my Netflix account earlier this month. Once Netflix announced its new pricing structure and plan options, their users understandably became disgruntled. So much, that the Netflix stock has dropped so rapidly that shareholders are wanting out, and fast!

You can see the Netflix stock dropping in real-time, right here! Google Finance – Netflix

 

Since then, Netflix has decided to split off into two separate companies — Netflix, which will handle the less demanding video streaming service, and Qwikster, which will handle the DVD portion. They have attempted to put out a fire of controversy over how its recent price changes by offering an apology and new name for its DVD-by-mail business. The wholly owned subsidiary Qwikster will add games to what it rents.

No more immediate price changes will result. The price changes announced over the summer effectively hiked subscribers who get both mail and streaming videos by 60 percent. Instead of one $9.99 charge, they now had two $7.99 charges. The company said this month that it lost 1 million customers since the price change, about 4 percent of its total. Netflix stock has plunged 19 percent since the subscriber loss was disclosed. The DVD unit chief Andy Rendich will be CEO of Qwikster.

The businesses will have separate websites and customers will be billed separately for each. “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,” Netflix chief executive Reed Hastings said in a note sent to customers. “So if you subscribe to both services, and if you need to change your credit card or e-mail address, you would need to do it in two places.” What a pain in the ass.  Continue reading “Netflix introduces Qwikster, and its rapid decline” Netflix introduces Qwikst…