A few months ago, you may remember that NetFlix announced a change to their service offerings and a price hike. Subscriber outrage was immediate and quite loud, with people posting to Twitter and Facebook that it was unfair of NetFlix to charge more for their outdated streaming catalog. Many threatened to cancel their service once the price change went into effect on September 1st (for existing customers. New customers were signed up at the new, higher rates.) A few days ago, NetFlix revised their third quarter guidance and will end their quarter with about 24 million subscribers. Turns out, about 1 million now-former customers made good on those threats.
I should say that Rich and I have been Netflix subscribers since 2003. For most of those 8 years, Netflix has been a great service. We never even looked at other DVD-by-mail services that came along from Blockbuster or Wal-Mart. There was no reason to leave; Netflix was the easy, quiet service that did what it was supposed to and didn’t charge to much to do it. However… The recent moves by Netflix, executed with complete tone deafness, is about to break my really loyal back.
Why? This situation is unfolding like a bad headline from The Onion. After months of outrage, they are apologizing by cleaving their company in two. So now, I can expect the following things as a loyal Netflix/Quikster/whatever else it will want to name itself subscriber:
- Two charges on my credit card instead of one. Consolation prize: The end total is the same as the new price.
- My DVD and instant queues on two websites instead of one. Per Reed Hastings, “A negative of the renaming and separation is that the Qwikster.com and Netflix.com websites will not be integrated.”
- The decision of whether I want to remain a customer of Netflix, Quikster, or neither one.
It takes alot for me to say that I’m outraged and it takes a whole lot to really make me flaming mad. I’m not outraged or mad – yet. But I am annoyed. I’ve always said that the key to good communications is context. For the second time, Netflix has provided zero context as to why it’s making these moves. But as someone who follows tech and media, I get it. The movie studios want lots of money for their content and building out the instant streaming infrastructure isn’t cheap.
But to come back two months later and say “many members felt we lacked respect and humility in the way we announced the separation of DVD and streaming and the price changes” is an understatement. And, thanks to a subtle use of language, they still aren’t owning up to their communication mistake. Many members now feel like you’ve acted without respect or humility again. Perhaps, Netflix, you will listen on the third try?