Well, everyone who subscribes can take a look at the apology e-mail Netflix (or will he also or just be Qwikster CEO?) head Reed Hastings sent around can take what they will from it. He's painting it as a botching of the price change/split.
I note that an expansion of the mail business (Qwikster) to include games would undercut a current advantage for Redbox and Blockbuster. I doubt it will make a dent against Gamefly (a games-only service) unless and until the inventories get on a comparable footing. Of course, if the pricing allows for much cheaper games with Qwikster over Gamefly, it's a different story. David ________________________________ From: Wesley McGee <[email protected]> Subject: Re: [TV orNotTV] Netflix is splitting up, becoming streaming-only. DVD rental company to be called Qwikster... On Mon, Sep 19, 2011 at 4:44 AM, PGage <[email protected]> wrote: On Mon, Sep 19, 2011 at 1:21 AM, Wesley McGee <[email protected]> wrote: > >This is something a company does when it is flailing. Days after reports came >in that they misestimated what subscriber loss they would have with the new >price structure, they announce what looks to be a panic restructuring. >> >>http://blog.netflix.com/2011/09/explanation-and-some-reflections.html >> >I'm not sure this is the accurate spin. The misestimate of subscribers was >based on a year ago, not an estimate of loss over the last 2 months. And >spinning off a separate service is pretty much the direction they have been >going in all summer - putting the two businesses on two different footings, >and making it clear that they will live or die primarily with the streaming. >What they did not want to be in 5 years is the king of mail order DVDs - to >about the last 100,000 people who watch more than 3 DVDs a year. They would >rather try and fail to be a real player with streaming, which they see as the >future. If, in 5 years, Blockbuster is making a lot of money mailing out DVDs, >then Netflix will have been shown to have made a mistake. Hard to predict the >future, but I don't think betting on streaming is too stupid. > I'm not sure I agree or disagree, but the optics of this is horrible. This is an announcement he made on Sunday night. How many businesses make major announcements on Sunday night? It comes four days after the stock collapse (from the reported variance between expected and actual subscribers, whether the estimates came from last year or no). This could all be right in the end, but the way they get there is worrisome. If he intended to the business off from each other, why did he not announce it when he announced the price increases? This does not sound like they are embarking on their planned strategy. Maybe they're rushing it, which seems to be an even bigger mistake. I can see this announcement driving people to the perceived stability of Amazon or others. -- TV or Not TV .... The Smartest (TV) People! You received this message because you are subscribed to the Google Groups "TV or Not TV" group. To post to this group, send email to [email protected] To unsubscribe from this group, send email to [email protected] For more options, visit this group at http://groups.google.com/group/tvornottv?hl=en -- TV or Not TV .... The Smartest (TV) People! You received this message because you are subscribed to the Google Groups "TV or Not TV" group. To post to this group, send email to [email protected] To unsubscribe from this group, send email to [email protected] For more options, visit this group at http://groups.google.com/group/tvornottv?hl=en
