I messed up. I owe you 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. Let me
explain what we are doing.
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). So we moved quickly into streaming, but I
should have personally given you a full explanation of why we are
splitting the services and thereby increasing prices. It wouldn’t have
changed the price increase, but it would have been the right thing to
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. DVD is a great option for those
who want the huge and comprehensive selection of movies.
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
need to focus on rapid improvement as streaming technology and the
market evolves, without maintaining compatibility with our DVD by mail
So we realized that streaming and DVD by mail are really
becoming two different businesses, with very different cost structures,
that need to be marketed differently, and we need to let each grow and
It’s hard to write this after over 10 years of mailing DVDs with
pride, but we think it is necessary: 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”
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,
but now that DVD by mail has its own team, we are finally getting it
done. Other improvements will follow. A negative of the renaming and
separation is that the Qwikster.com and Netflix.com websites will not be
There are no pricing changes (we’re done with that!). If you
subscribe to both services you will have two entries on your credit card
statement, one for Qwikster and one for Netflix. The total will be the
same as your current charges. We will let you know in a few weeks when
the Qwikster.com website is up and ready.
For me the Netflix red envelope has always been a source of joy.
The new envelope is still that lovely 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 similar for many of you.
I want to acknowledge and thank you for sticking 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.
-Reed Hastings, Co-Founder and CEO, Netflix
p.s. I have a slightly longer explanation along with a video posted on our blog, where you can also post comments.