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Netflix bails on Qwikster, will continue to operate DVD service

10.10.2011

RIP Qwikster, we hardly knew ye.

Less than a month after announcing that they'd be spinning off their DVD-by-mail service into a new, separate company named Qwikster, Netflix has announced this morning they'll be abandoning that plan.

A Netflix spokesperson said, "We underestimated the appeal of the single web site and a single service," adding, "We greatly underestimated it." Yes. Yes, you did.

Added CEO Reed Hastings, "There is a difference between moving quickly—which Netflix has done very well for years—and moving too fast, which is what we did in this case."

The actual separation of Netflix into two companies - Netflix for online streaming and Qwikster for DVD-by-mail - never happened despite the promise in the original announcement. The company was still in the wake of customer uproar following a controversial price increase when they announced the Qwikster news. But the news proved even worse for company relations as many customers took to Facebook, Twitter and their blogs to protest and announce the cancellation on their accounts.

While Qwikster will be dying a very swift death, the price increase announced earlier by Netflix will remain in effect. As for adding video game rentals, a promise of the new Qwikster service, Netflix says that "may or may not" still happen.

Netflix had previously announced that it expected about 1 million account cancellations in the wake of their recent decisions but would not comment formally on the actual numbers. Nor would they speak publicly about quarterly losses, which will be announced later this month.

Source: New York Times

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