Netflix DVD Service Splits from Streaming to form ‘Qwikster’ Company

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In a recent bombshell dropped by Netflix’s CEO Reed Hastings, it has been announced that Netflix’s DVD-by-mail service will be separate from Netflix’s streaming and called Qwikster.

The new Qwikster service will offer DVD, Blue Rays and now, Video Games by mail. I speculate that this move is two-fold as an answer to the recent price hike for the DVD-by-mail service and to really push the market towards more streaming services for movies and TV shows.

Hastings put in a recent blog post the following:

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.

A video has also been made by Hastings and New Netflix (DVD-by-mail portion) CEO Andy Rendich explaining their so-called goof-up with communicating to the users about the new changes. Sure, I will take the explanation just don’t mess with the pricing again raising it 60% like you did last time. Whether the service will be “Better” as explained, has yet to be seen. I may take them up on the game rental offer though, how about you?

After watching the video, what is your take?

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