Netflix CEO acknowledges difference between legacy, online businesses

The Netflix Blog

In an email to customers and a post on the company blog, Reed Hastings acknowledges that the unpopular price hike for Netflix was poorly handled. The statement doesn't reverse any of the decisions about splitting Netflix into separate streaming and direct-mail products with separate prices. It does announce that the DVD-by-mail company will now be known as Qwikster, while the streaming service will remain Netflix. Hastings explained (in logic that might sound familiar to news organizations running both legacy and online businesses):

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

Related: Understanding why Netflix changed pricing | Whoops: The @Qwikster Twitter account is already taken

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    Jeff Sonderman

    Jeff Sonderman is the deputy director of the American Press Institute, helping to lead its use of research, tools, events, and strategic insights to advance and sustain journalism.


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