Re-launched, but still slightly under construction. :-)

Tuesday, September 20, 2011

An Open Letter to Netflix

Dear Netflix -

Like the rest of your customers, I received the letter from your CEO, Reed Hastings, yesterday:

"But now I see that given the huge changes we have been recently making, I should have personally given a full justification to our members of why we are separating DVD and streaming, and charging for both. It wouldn’t have changed the price increase, but it would have been the right thing to do."

The apology letter detailed the company's future plans to separate your DVD and streaming services, to rename your DVD service Qwikster, and to charge for them, separately. Well, on behalf of your customers, I would like to respond:

You guys are so stupid. "Qwikster?" What 50-year-old intern poring over 90s-era case studies came up with that name?

Look, you went about this the wrong way to begin with. You should have explained to customers about the difficult new contact negotiations the company was facing, and the reluctance of major studios to give up their streaming revenue in exchange for a flat fee, instead of letting business reporters do it for you. They want individual branding and extra compensation, like cable channels offer - nevermind that cable TV is being rendered extinct by the market penetration of new technologies like your very own streaming service and that it has the highest rate of customer dissatisfaction of any service industry in America, even behind cell phone companies. Basically, in an age of both innovation and austerity, studios are pitching a temper tantrum on the boardroom floor.

The Netflix CEO likes to say that actions speak louder than words, and that's great. A worthwhile product and great customer service go a long way. But if the only action customers can see and feel is a 60 percent rate hike, in the middle of a market that is - for now - still controlled by cable television, words become necessary.

Netflix, you had a great deal of brand loyalty, and you squandered it by not remembering your place in the market. Yes, you are still cheaper than cable. But you are still an ancillary service that most households carry in addition to cable - not the primary, stand-alone content provider for American households. You are still the scrappy upstart yapping at bloated, gluttonous media companies like Time Warner. You are democracy, capitalism and innovation. They are oligarchy, monopolization and status quo. You are not yet a major force in contract negotiations. Know your role and use it. We look forward to your future.

I am one of those few households that uses you as the primary content provider. I don't carry cable because I find it less reliable than my 6-year-old's memory for chore lists. I won't change my service for now, because you are still cheaper than cable - and I like the BBC serial content you provide - thanks for "Downton Abbey," "MI-5" and "Lost in Austen." But you all have to get your crap together. Nobody wants YET ANOTHER bill (really, two bills every month instead of one?), especially from a company (seriously, "Qwikster?") that sounds like a two-bit gas station."


  1. You are not alone.