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Netflix Axes Its DVD Spinoff Qwikster

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In a strange turn of events, Netflix cancelled its plan to launch its spinoff company Qwikster, which it announced only a few weeks ago in September. The idea was to rename the DVD-by-mail business Qwikster, while the instant streaming service would keep the well-established name, Netflix. But now, this is no longer happening.

In an email sent out to current and recent Netflix customers, and in a post on the Netflix blog, Reed Hastings, the company’s CEO, described the reasoning behind the cancelled change.

He said: “It is clear that for many of our members two websites would make things more difficult, so…Netflix [will remain] one place to go for streaming and DVDs. This means no change: one website, one account, one password…in other words, no Qwikster.”

Hastings makes reference, here, to many customers‘ and critics’ complaints that the launch of Qwikster would require existing customers to maintain two separate accounts and to pay two separate times, if they wanted to keep both services. Additionally, it would also mean customers would need to manage two separate and unrelated movie queues.

Hastings also mentions the Netflix’s controversial price change from this last sumer: “While the July price change was necessary, we are now done with price changes.” The company did go back on its split, but obviously has no plans to go back to its original pricing structure. The rising costs studios are requiring for content caused the price hike, which Netflix customers are simply going to have to live with.

This announcement is an understandable one and, perhaps, a saving grace for Netflix. With all the confusion and backsplash Netflix received from the raised prices and planned Qwikster split, the company lost millions of customers and the stocks plummeted from over $300 a share to around $111 at the time of this writing.

For Netflix’s sake, let’s hope that customers don’t take this new announcement as a sign of weakness. Instead, in the long run, let’s hope they see it as a sign of taking things back to the way they were – except for the price change, of course.

Certainly, though, this gives the impression that Netflix is being mismanaged. Many comments on Netflix’s blog indicate that customers aren’t impressed with the CEO, but are thankful that the original Netflix is back. However, they are watching the quality of the catalog, which they should because of the increasing competition from Blockbuster, Amazon, and Hulu.

What do you think of Netflix’s latest announcement? Is it enough to get you to stay with the service? Or, are you still going to leave. Please share your thoughts in the comments.

August Drilling, from Forte Promotions which sells promotional products, is an avid social network user and recent graduate from the University of Minnesota – Twin Cities.

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