I recently watched the video apology from Netflix Co-Founder and CEO, Reed Hastings.
I really expected to gain some insight on why Netflix raised their pricing which would help me to understand why it was necessary, something along the lines of it being necessary for negotiating better content with content providers. As it turns out, it sounds like a bunch of bullshit.
How does splitting Netflix into two separate companies help them focus better on one thing or the other? I can perhaps understand from a website development stance that it’s a bit complicated trying to program their system to handle new things like video games in the rental queues (something they mentioned adding to the new Quickster DVD-by-mail service, with streaming video handled by the same website…but really come on…it can’t be holding you back that much. If it’s about organization, can’t two divisions within the same company be formed to handle the two different services?
This sounds like bullshit you’re trying to pass on your customers, as you didn’t justify it at all. Did you really think this was going to help? I kept a tight lip when a friend of mine talked about how he was mad that you raised the rates without formal notification. I figured that you’re just trying to make the service better, and really getting DVD’s and unlimited streaming video for the price that was offered was just too good of a deal. I didn’t have a problem with that…but to do this and then not improve the service with better content, or at least communicate to your clients that is what you’re working on accomplishing…and then pull this and make the service more inconvenient?!?! Seriously Reed?
Don’t you understand that people just want convenient entertainment, and being able to watch streaming video while they wait for the DVD in the mail, and manage both via the same queue, was the whole reason why customers were with you? Don’t you know that should you raise the rates, somehow those customers should be getting more?
You’re throwing away all the value you provided, the respect that your customers had for your company, all out the window. I expected you to be the leader in the entertainment revolution, with all the support of your streaming service added to Roku boxes, video game systems, or desktop applications (such as Boxee). I expected you to steal away all those clients who are tired of paying for a bunch of shit programming for $100 a month through a cable provider, opting to pay you $15 for your service, and $30-$50 for their broadband internet service. I expected you to bring the cable industry to it’s knees, just like you’ve done with Blockbuster. Even Redbox doesn’t have the advantage you have …no late fees resulting from the everlasting tendency for humans to get occupied with other things while that DVD sits on the table.
I expected the cost of better content to mean raises in your pricing. If people are using the service too much, cutting into your profits, I would understand implementing a change in packages that imposes limits or something …but I never expected this.
Here’s an idea, feel free to take it and use it. Leave your customers on the current price and service, and if you’re wanting to improve the service as an initiative into the future, offer that extra programming for an extra price. Kind of like ‘Want content from Disney, or Sony, or whatever? That will be an extra $10 per month.’ If you do that, you won’t get lashback from your customer base.