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Items of General Interest

Netflix or NetFizzle?

In response to an email I received on 19 September 2011.

Dear Netflix ~

I am frustrated for the following reason(s):

  1. I received an email which SEEMED personable but is absolutely IM-personal
  2. I cannot contact Netflix to post a comment in response to my email
  3. Attempting to call Customer Support at Netflix: delay time > 25 minutes
  4. I am unsure of just how to get these points across to you (Netflix)
I will explain each of these points in detail.
1 – Here is the email I received:
From: Reed Hastings, Co-Founder and CEO of Netflix [mailto:info@netflix.com]
Sent: Sunday, September 18, 2011 11:50 PM
To: my email address
Subject: An Explanation and Some Reflections

Dear John,

I messed up. I owe you an explanation.

It is clear from the feedback over the past two months that many members felt we lacked respect and humility in the way we announced the separation of DVD and streaming and the price changes. That was certainly not our intent, and I offer my sincere apology. Let me explain what we are doing.

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). So we moved quickly into streaming, but I should have personally given you a full explanation of why we are splitting the services and thereby increasing prices. It wouldn’t have changed the price increase, but it would have been the right thing to do.

So here is what we are doing and why.

Many members love our DVD service, as I do, because nearly every movie ever made is published on DVD. DVD is a great option for those who want the huge and comprehensive selection of movies.

I also love our streaming service because it is integrated into my TV, and I can watch anytime I want. The benefits of our streaming service are really quite different from the benefits of DVD by mail. We need to focus on rapid improvement as streaming technology and the market evolves, without maintaining compatibility with our DVD by mail service.

So we realized that streaming and DVD by mail are really becoming two different businesses, with very different cost structures, that need to be marketed differently, and we need to let each grow and operate independently.

It’s hard to write this after over 10 years of mailing DVDs with pride, but we think it is necessary: In a few weeks, we will rename our DVD by mail service to “Qwikster”. We chose the name Qwikster because it refers to quick delivery. We will keep the name “Netflix” for streaming.

Qwikster will be the same website and DVD service that everyone is used to. It is just a new name, and DVD members will go to qwikster.com to access their DVD queues and choose movies. One improvement we will make at launch is to add a video games upgrade option, similar to our upgrade option for Blu-ray, for those who want to rent Wii, PS3 and Xbox 360 games. Members have been asking for video games for many years, but now that DVD by mail has its own team, we are finally getting it done. Other improvements will follow. A negative of the renaming and separation is that the Qwikster.com and Netflix.com websites will not be integrated.

There are no pricing changes (we’re done with that!). If you subscribe to both services you will have two entries on your credit card statement, one for Qwikster and one for Netflix. The total will be the same as your current charges. We will let you know in a few weeks when the Qwikster.com website is up and ready.

For me the Netflix red envelope has always been a source of joy. The new envelope is still that lovely red, but now it will have a Qwikster logo. I know that logo will grow on me over time, but still, it is hard. I imagine it will be similar for many of you.

I want to acknowledge and thank you for sticking with us, and to apologize again to those members, both current and former, who felt we treated them thoughtlessly.

Both the Qwikster and Netflix teams will work hard to regain your trust. We know it will not be overnight. Actions speak louder than words. But words help people to understand actions.

Respectfully yours,

-Reed Hastings, Co-Founder and CEO, Netflix

p.s. I have a slightly longer explanation along with a video posted on our blog, where you can also post comments.

This message was mailed to [my email] by Netflix. SRC: 1579.0.US.en-US
Use of the Netflix service and website constitutes acceptance of our Terms of Use and Privacy Policy.
(c) 2011 Netflix, Inc. 100 Winchester Circle, Los Gatos, CA 95032, U.S.A.

As you can see, it ALMOST looks personal. So, I went to the ‘our blog’ link and tried to Comment a response (see below for my response).
As it turns out, I must be a Facebook subscriber to make a comment – and I am NOT a Facebook subscriber, nor do I want to be a Facebook subscriber, and there was no way to post my comment without my becoming a Facebook subscriber. Thus, another impersonal aspect of this email manifested itself.
Here is the response I tried to send:
I went to your blog and tried to leave a comment. I am NOT on Facebook, and I REFUSE to be on Facebook, so – I am hoping I can reach you this way. Here is my comment, Reed:

Two very important points: (1) Don't get so committed to your course of action that you deny the validity of the arguments of those who protest, (2) There are some people (I am in the minority, I know) who CANNOT RECEIVE STREAMING products.

I happen to be in a very rural area, and Netflix provides the ONLY movie option available, short of actually buying a movie or renting from the local grocery store. I have been a Netflix subscriber for more than 10 years, faithfully renting movies originally starting with 3, then went to 5 movies in circulation at a time. With your new pricing policy, I dropped to 2 DVDs.

I didn't like dropping to 2 - I am dismayed at your explanation for your business decision, since it seems that you love the name Netflix and so do I! Why on earth don't you change the NEW name to Streamster (or something more related to what you plan) and leave the Netflix name with the flicks - with the movies we've been receiving all this time? I am a loyal Netflix fan - thinking in terms of DVDs. I don't like the name 'Qwikster' - and why not price the DVDs using the same pricing scheme that you discarded?

Play with pricing in your new scenario, if you'd like - but as they say, "If it ain't broke, don't fix it", and "Don't change horses in the middle of the stream". Those maxims are in our culture for a reason!

Facebook may be a convenient way for you to accept comments – I feel violated to think you can only be reached via Facebook. I don’t know how you will treat my comment, but I hope that it reaches you for your consideration.
Regards ~ A loyal (up to now) Netflix subscriber ~ John

2 - This brings me to my second point – replying to the message I received resulted in an automated response, telling me to contact Customer Service. The ‘Contact Us’ option for Netflix is as impersonal as the letter. In that it SEEMS that contact is possible, but it is NOT possible to send a comment or message of any type, using the links provided. There IS a way to ‘talk’ to Customer service, however.

3 – After digging, I found the phone number to call Netflix – 1-866-716-0414 along with a service code (265 805) to speed up response. The warning is given that the ‘current wait time’ is 26 minutes. I figured that my 26 minutes would be better spent if I could figure out how to document what I am going through, so I have spent that time writing this email.

4 – Now – what to do with it? Since I don’t know the answer, or at least know the BEST answer to that question, I’ll simply place this on Allshare. Others will read it, or they won’t, and Netflix will see how I feel, or they won’t. But the Allshare title tells it all – is Netflix about to become NetFizzle?

(See how 'personal' this communication was?)
From: Netflix (Auto Reply) [mailto:noreply@netflix.com]
Sent: Monday, September 19, 2011 5:48 AM
To: my email address
Subject: UNDELIVERED

Dear Netflix User,

Your email has reached an automated mailbox. Email sent to this address does not reach our Customer Service team and will not receive a personal response.

If you have a question you need answered right away, please visit our online Help Center at http://www.netflix.com/Help. It covers a wide variety of commonly asked questions.

If you need to contact a customer service representative please visit http://www.netflix.com/ContactCustService.

Thanks for contacting Netflix.

Sincerely,
Your Friends at Netflix

Author:John B. Moss
Submitted by: John B. Moss, 19 September 2011
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