The popcorn bowl sits on my lap as I press play, and the widely-recognized “Netflix” logo comes on the screen in the brief moment before the movie begins. Netflix is a company founded in 1997 that allows people to order movies online and receive them by mail. Customers also have the option of streaming certain movies instantly onto their computer. Netflix has been growing at an extremely fast rate since its launch in 1997- as of today, over 24 million people have subscribed to their services.
Recently, however, the people at Netflix decided that some changes had to be made. It appeared to them as though their DVD rental services and their instant streaming were becoming two separate businesses. They believed that in order to maintain their rapid growth rate, they should create two different businesses that would each operate independently.
In September 2011, Netflix announced that it would actually carry out this idea of splitting the company into two and that their DVD by mail service would be renamed to “Qwikster.” Some newly-added benefits to their DVD by mail service would be the addition of games for gaming consoles like the Wii, the Xbox, and the PlayStation.
Under the plan, the name “Netflix” will remain for the streaming end of the business. The two separate services will operate from their own websites: Qwikster.com and Netflix.com.
Many customers were upset about the split because they will have to sign up for them independently on separate websites. They will have to pay more in order to receive both services. Netflix lost many customers since the announcement, and its stock has reached all-time lows. One member of our community, Mr. Gruenberg, even mentioned having a long phone call with Netflix where he explained why this decision could mean the end of his subscription to the website.
When asked what she thought about the changes Netflix will undergo, Natalia Rivera ’13 stated, “I do not think Netflix should split into two different companies. I loved having both services together and on the same website.”
Update: On Monday, October 10, Netflix announced that the company was abandoning this plan in response to consumer complaints.