“I messed up and owe you an explanation.”
That’s the first line of an email that millions of Netflix customers received in their inboxes recently. Before then, not many customers even new who Reed Hastings, the co-founder of NetFlix, was.
For those that took the time to read the 671-word apology, they were likely disappointed, confused, or both.
Netflix’s decision to separate subscriptions between their DVD and streaming businesses over a month ago created a huge backlash from both customers and analysts. In order to continue their current DVD and streaming service, Netflix customers would incur a 60% monthly fee increase.
Many, including this author, decided to downgrade their service to streaming-only.
After apologizing for “the way we announced the separation of DVD and streaming and the price changes,” Mr. Hastings goes on to explain that they had found that there were two separate and distinct markets for DVDs and streaming.