By Julia Hahn, Columnist
Netflix, the DVD rental and movie-streaming giant which since 1999 offered a flat-rate subscription for an unlimited number of rentals, announced on Sept. 18 that they would no longer be offering DVD rental services.
Instead, the company intends to create a separate entity called “Qwikster” to handle all of their physical media rentals, while Netflix will still remain a movie- and television-streaming service. Unfortunately, for those who made ample use of Netflix’s streaming and physical DVD rental services, the new service “Qwikster” will require an additional website with a separate account and, worst of all, an additional bill every month.
Netflix has been upsetting its DVD rental customers for some time, after the company raised the subscription fee for DVD rental two months ago. Claims have been made by Netflix that the goals of the separation are to make the experiences of the individual customers better all around.
The company’s CEO, Reed Hastings, said, “Our view is: with this split of the businesses, we will be better at streaming, and we will be better at DVD by mail.” Whether or not this will hold true can’t be said for certain, but that hasn’t stopped people from voicing their malcontent. Many scoff at Netflix’s defense of making things easier for users, and most would like to see a return to old ways. Some defended Netflix’s decision to separate the two services; however, those comments are from the customers who exclusively streamed their content in the past. Many were upset when Netflix removed the “Add to DVD Queue” option from certain streaming devices such as the Xbox 360, and even worse was the recent loss of Sony Pictures and Disney movies via the streaming service.
Both media renters and content streamers may experience even further content loss if Starz, which has the rights to the aforementioned movie sub-companies, does not renew its contract with Netflix.
No one is quite sure what the point behind this move is, and even financial analysts are criticizing these latest decisions made by Netflix.
Michael Pachter, who covers Netflix for Wedbush Securities, had particularly strong opinions on these decisions. By separating its services into two websites, the company is making its services much more difficult to use, Pachter said.
Between price hikes, content cutting, and the loss of the DVD queue to current Netflix users, the company is on the road to alienating its customers and eventually finding itself without revenue. The most important part of running a business like Netflix is the customers, and getting those customers to keep coming back.
“Qwikster’s” success depends on how big of a monopoly Netflix has become. Long gone are the days when Blockbuster Video Rental, and Netflix reigns supreme. If Netflix truly has beaten out its competition, then its customers will have no choice but to subscribe to both of their services in order to satisfy their movie cravings.
