Before I begin the following analysis of the ridiculous announcement this week, I’ve got to be straightforward and ask myself: Who am I kidding? There’s no way I’ll ditch my streaming and disc accounts from Netflix and the-part-of-Netflix-that’s-now-called-something-dumb. If you have no idea what I’m talking about, then I have to assume you didn’t receive the "apology" e-mail from Netflix’s CEO, Reed Hastings. You’ve also apparently not heard your friends who subscribe to the red-envelope-and-streaming service start bitching about it.
So what’s the deal? A while back, Netflix announced they’d be splitting up the charges for their DVD and streaming plans, ultimately resulting in a price increase for anyone who wanted to keep both services.
The backlash was immediate and loud, and things must have come to a head behind the scenes when Netflix stock took a nosedive following the announcement they were cutting their subscriber projections for the quarter. Gee, what a shocker – people actually followed through on their threats to quit/not sign up, and as a result investors flipped out. Nobody saw that coming!
Well, the company hastily slapped together a terrible idea that was unveiled earlier this week, prefaced with a rambling and creepy too-casual e-mail from the CEO. Sorry, I’m among the casual-est mofos out there, but I don’t really like CEOs of companies who just screwed me starting e-mails with "I messed up. I owe you an explanation." Well, Reed (since we’re obviously on a first-name basis), that may be a promising "my bad" beginning, but the rest of the e-mail took a rapid downturn. At first, I thought perhaps the company was going to do some kind of make-good on the plan changes (which honestly wouldn’t have been that big a deal – except it arrived in the face of the already-questionable streaming library facing even more cuts). "Apology" in "Reed Hastings-land," however, actually means "an explanation that we’re sorry we didn’t say clearly enough that we want to mess up your service even more."
The price change, he explained, was just the beginning. Because Netflix loves its customers SO MUCH, they decided to eliminate – excuse me, "spin off" – the disc portion of the business and give it the completely unmemorable and somewhat ridiculous name "Qwikster." Sorry guys, 1998 called, they want their X-TREME SPELLINGZ back. Netflix will retain its name, though it will be streaming-only. Customers will now have to log in to two separate sites to manage two separate queues – that likely won’t have the kind of features the two queues did in old-school Netflix (in other words, I can see a "watch now" button on titles I have in my disc queue that are available for streaming).
Clearly, this isn’t the end of the world and, as I said right off the bat, I’m pissed about this but not about to lose my services. So I guess Netflix wins, ultimately. This is also inevitable, and something I’ve been sort of predicting for years – with every change the company has made over the last few years, I’ve told people they’re actively trying to kill off the disc business. Many pundits have also pointed this out in the wake of this announcement, and they’ve also been quick to point out this is Netflix finally pulling off the band-aid and giving themselves an easy out when they want to completely drop discs. That’s all well and good, but with a dwindling (NOT expanding) streaming library that’s poised to lose another roughly 1,000 titles in early 2012 (Google "Netflix Starz deal"), this seems like a very ill-informed move.
But, then again, I’m not the CEO of a company with stock prices at $290â¦ I mean $200â¦ I mean $150â¦ I mean $128â¦ oh crap, still falling. Hmm, maybe I’m on to something after all.