Following some price changes stemming from a separation of its streaming video and disc-by-mail services, Netflix’s customer base went into revolt and the company’s stock price followed, falling 26 percent in two days. In response, Netflix has decided to rebrand the disc-by-mail division as Qwikster. Netflix CEO Reed Hastings announced the change in a blog post last night.
“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. That was certainly not our intent, and I offer my sincere apology,” wrote Hastings.
“I see that given the huge changes we have been recently making, I should have personally given a full justification to our members of why we are separating DVD and streaming, and charging for both. It wouldn’t have changed the price increase, but it would have been the right thing to do.”
“It’s hard for me to write this after over 10 years of mailing DVDs with pride, but we think it is necessary and best: In a few weeks, we will rename our DVD by mail service to “Qwikster”,” he continued. “We chose the name Qwikster because it refers to quick delivery. We will keep the name 'Netflix' for streaming.”
Qwikster will operate as a separate company from Netflix, having its own site and own billing system. Users will no longer be able to manage their streaming and disc queues from the same web portal.
The big news is the addition of video game rentals. Qwikster will be adding Wii, Xbox 360, and PS3 rentals for a small add-on fee.
“One improvement we will make at launch is to add a video games upgrade option, similar to our upgrade option for Blu-ray, for those who want to rent Wii, PS3 and Xbox 360 games. Members have been asking for video games for many years, and now that DVD by mail has its own team, we are finally getting it done,” Hastings announced.
I’m personally a streaming user, but the addition of game rentals – depending on the price – could sway me back to the disc service. Will Qwikster count you in as a customer, or are you already in love with GameFly, Blockbuster, or RedBox?
