Netflix Cancels Plans to Split DVD, Streaming Services

It seems Netflix won’t split its DVD and video streaming services after all.

Last month, CEO Reed Hastings announced that Netflix would push the company’s DVD rental service to a new website called Qwikster while Netflix would be reserved for streaming only. Under the new plan, customers who wished to stream movies and watch DVDs would have to maintain two separate accounts and pay two separate charges, a proposal that infuriated many Netflix customers.

“Two services does no one but Netflix any good,” wrote ZDNet’s Andrew Nusca. “From a branding perspective, creating a new one to send off into the sunset is confusing. Two statements on one’s credit card is perplexing. And two websites to manage a single mental queue is unnerving.”

Though Netflix initially defended its decision to split the services into two businesses, the company finally relented after enduring weeks of criticism and plummeting stock.

"It is clear that for many of our members two websites would make things more difficult, so we are going to keep Netflix as one place to go for streaming and DVDs," Hastings wrote in a blog post today.

Neflix’s change of heart seems like a good move thus far. The company’s stock went up $8.63, or 7.4%, to $125.84 this morning. However, Netflix has yet to recover from the price change announcement last July, a move that cost the streaming and DVD rental service 1 million subscribers and caused its shares to fall by 60%. 

Sources: Forbes, Ft.com


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Categories: Entertainment

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