More changes in Netflix's future. - High-Def Digest Forums
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Old 09-19-2011, 01:40 AM
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Default More changes in Netflix's future.

http://blog.netflix.com/

I messed up. I owe everyone an explanation.

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. I’ll try to explain how this happened.

For the past five years, my greatest fear at Netflix has been that we wouldn't make the leap from success in DVDs to success in streaming. Most companies that are great at something – like AOL dialup or Borders bookstores – do not become great at new things people want (streaming for us) because they are afraid to hurt their initial business. Eventually these companies realize their error of not focusing enough on the new thing, and then the company fights desperately and hopelessly to recover. Companies rarely die from moving too fast, and they frequently die from moving too slowly.

When Netflix is evolving rapidly, however, I need to be extra-communicative. This is the key thing I got wrong.

In hindsight, I slid into arrogance based upon past success. We have done very well for a long time by steadily improving our service, without doing much CEO communication. Inside Netflix I say, “Actions speak louder than words,” and we should just keep improving our service.

But now 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.

So here is what we are doing and why:

Many members love our DVD service, as I do, because nearly every movie ever made is published on DVD, plus lots of TV series. We want to advertise the breadth of our incredible DVD offering so that as many people as possible know it still exists, and it is a great option for those who want the huge and comprehensive selection on DVD. DVD by mail may not last forever, but we want it to last as long as possible.

I also love our streaming service because it is integrated into my TV, and I can watch anytime I want. The benefits of our streaming service are really quite different from the benefits of DVD by mail. We feel we need to focus on rapid improvement as streaming technology and the market evolve, without having to maintain compatibility with our DVD by mail service.

So we realized that streaming and DVD by mail are becoming two quite different businesses, with very different cost structures, different benefits that need to be marketed differently, and we need to let each grow and operate independently. 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”.

We chose the name Qwikster because it refers to quick delivery. We will keep the name “Netflix” for streaming.

Qwikster will be the same website and DVD service that everyone is used to. It is just a new name, and DVD members will go to qwikster.com to access their DVD queues and choose movies. 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. Other improvements will follow. Another advantage of separate websites is simplicity for our members. Each website will be focused on just one thing (DVDs or streaming) and will be even easier to use. A negative of the renaming and separation is that the Qwikster.com and Netflix.com websites will not be integrated. So if you subscribe to both services, and if you need to change your credit card or email address, you would need to do it in two places. Similarly, if you rate or review a movie on Qwikster, it doesn’t show up on Netflix, and vice-versa.

There are no pricing changes (we’re done with that!). Members who subscribe to both services will have two entries on their credit card statements, one for Qwikster and one for Netflix. The total will be the same as the current charges.

Andy Rendich, who has been working on our DVD service for 12 years, and leading it for the last 4 years, will be the CEO of Qwikster. Andy and I made a short welcome video. (You’ll probably say we should avoid going into movie making after watching it.) We will let you know in a few weeks when the Qwikster.com website is up and ready. It is merely a renamed version of the Netflix DVD website, but with the addition of video games. You won’t have to do anything special if you subscribe to our DVD by mail service.

For me the Netflix red envelope has always been a source of joy. The new envelope is still that distinctive red, but now it will have a Qwikster logo. I know that logo will grow on me over time, but still, it is hard. I imagine it will be the same for many of you. We’ll also return to marketing our DVD by mail service, with its amazing selection, now with the Qwikster brand.

Some members will likely feel that we shouldn’t split the businesses, and that we shouldn’t rename our DVD by mail service. Our view is with this split of the businesses, we will be better at streaming, and we will be better at DVD by mail. It is possible we are moving too fast – it is hard to say. But going forward, Qwikster will continue to run the best DVD by mail service ever, throughout the United States. Netflix will offer the best streaming service for TV shows and movies, hopefully on a global basis. The additional streaming content we have coming in the next few months is substantial, and we are always working to improve our service further.

I want to acknowledge and thank our many members that stuck with us, and to apologize again to those members, both current and former, who felt we treated them thoughtlessly.

Both the Qwikster and Netflix teams will work hard to regain your trust. We know it will not be overnight. Actions speak louder than words. But words help people to understand actions.

Respectfully yours,

-Reed Hastings, Co-Founder and CEO, Netflix



Looks like I will be going to a different site for my dvds and Blu-rays?
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Old 09-19-2011, 02:14 AM
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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.
They should've bought out gamefly a long time ago... I'd be concerned that they could not mimick Gamefly's success here... Blockbuster's title availability is worse than abysmal (at least in the mail order service). Once I get confidence though that Qwickster can send games to me pretty quickly, I'd probably drop gamefly.

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So if you subscribe to both services, and if you need to change your credit card or email address, you would need to do it in two places. Similarly, if you rate or review a movie on Qwikster, it doesn’t show up on Netflix, and vice-versa.
Ouch. That's not helpful Hastings...
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Old 09-19-2011, 02:52 AM
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Oh my.

This is significant.

Completely splitting the two websites and billing is a PITA. Makes sense on a lot of levels.

"Qwickster"? Wow. Start about starting brand equity from scratch.

If it helps then stock more Blu-ray tiles and stop treating the disc by mail side as a piggy bank to help streaming it will not be bad for disc users. Plus it gives them a chance to emphasize that new movies are at the quicker availability of Quickster when deemphasizing newer movies at Netflix and concentrating on its long tail and TV content.

Surprising move though here.
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Old 09-19-2011, 04:14 AM
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Quickster.com with images of logo and red envelopes.



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Old 09-19-2011, 04:15 AM
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Originally Posted by Kosty View Post
"Qwickster"?
No. Qwikster.

DUHHH!

Man, that is not a good name. It looks like Quiltster. Or QuickSister.
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Old 09-19-2011, 04:21 AM
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Originally Posted by cakefoo View Post
No. Qwikster.

DUHHH!

Man, that is not a good name. It looks like Quiltster. Or QuickSister.
LOL

Do a google search now on quickster which is how most people would spell it

Its a urban slang for a quick pick up artist and A Sponge Bob Squarepants superhero alterego with a normal spelling.

Quote:
1. quickster 23 up, 1 down
Being able to get girls in the sack quick.
Did you see that quickster in action? It only took him 5 minutes to get that girl to his bedroom.
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Old 09-19-2011, 04:23 AM
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Qwickster, meet the Mailster.



In a refreshingly humble-- almost supplicant-- blog post, Netflix has finally explained the logic behind their unpopular and seemingly unsuccessful rate switch this July:

...we realized that streaming and DVD by mail are becoming two quite different businesses, with very different cost structures, different benefits that need to be marketed differently, and we need to let each grow and operate independently. 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”.

We chose the name Qwikster because it refers to quick delivery. We will keep the name “Netflix” for streaming.

...At first blush, the logic of splitting DVD delivery from streaming makes sense to me: licensing for streaming and DVD rentals are two different beasts. I think they may have made this decision looking forward toward their recent parting of ways with Starz.

Even if it's not the right decision, it will take a little while to shake out. But I can tell you, with twitter still reeling about Netflix's announcement, one thing they definitely got wrong: the Qwickster branding.

The name is silly. I personally find the spelling painful. I doubt I'm alone in either of these opinions. But there's also a really powerful historical echo to the name, that dates back to the 1950s. And it's not a good association.

Let's say you're trying to think of a brand name that evokes the speed and efficiency of your service-by-mail. Is this the first thing you want (some) people to think of?



US Post Office Department Mailster -- photo from the National Postal Museum

Qwickster, meet the Mailster.


Netflix, please note, the Mailster was one of the biggest flops of American postal engineering. It had trouble going up hills. Mail carriers complained of them filling with smoke. It couldn't operate in three inches of snow. Some reported it could be knocked over by a large dog. And they had a high rate of injury. But the Post Office Department continued to produce more and more for over a decade, seemingly driven by a sunk cost fallacy.

The Mailster, simply put, was a bad idea, and a giant lemon.

Now, I've spent the last year of my life research the postal engineering. I've met USPS engineers-- they're a talented, intelligent bunch. And I have a lot of affection for the goofy little Mailster. It's a great reminder that engineering successes are built on trial and error, that we learn what works by seeing what does not. And more likely than not, most of the people who will see "Qwickster" and think "Mailster" are big old Postal geeks like me, and not the general population.

But the fact that the names are so similar doesn't bode well. Branding 101 tells you to avoid names that are going to evoke pricey, colossal mistakes of the past. Netflix is already skating on thin ice, PR-wise-- which is why their blog post has the apologetic tone it does.

Beyond the question of whether consumers really will respond positively to having two URLs and potentially two bills for what was once one service, this echo across time of the two names points-- in my opinion-- to a major business decision being made somewhat hastily, and unveiled while still half-baked. And that makes me worry for Netflix's future.

http://www.leisurelyhistorian.net/qw...t-the-mailster
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Old 09-19-2011, 04:29 AM
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The more grammatically correct you try to be, the worse you spell it:

Qwikster
Qwickster
Quickster
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Old 09-19-2011, 04:30 AM
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They're doing this for a quick stir, that's for sure.
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Old 09-19-2011, 04:36 AM
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So now, if you add a DVD to your queue, you won't know it's available for instant streaming. I don't know how that benefits the consumer or Netflix.
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