Reed Hastings is lucky he’s rich, because if he’s behind a move Netflix made yesterday he may be the stupidest CEO of a multi-billion dollar company, ever.
We’re taking a break from analyzing Google+ today, because yesterday Mr. Hastings’ Netflix initiated a business change that was so large and so misguided I just had to comment.
Netflix, a company that pretty much put the video store business out of business by offering DVDs in the mail for a better price and then deftly transitioned to an Internet video delivery service, has announced what amounts to a 60% price hike. You, the Netflix customer, get nothing in return.
OK, so you can avoid the price hike by opting to cut your DVD delivery options in half. And I understand that aside from what feels like unbridled greed Netflix is facing some business pressures as their streaming deals with TV networks expire and incredibly high price increases are being foisted upon them. But Mr. Hastings and Netflix just made a change to the service that their customers have become accustomed to and basically told their customers to eat it. Bad idea. The polar opposite of customer service.
The media business is undergoing tremendous change, and given that Netflix has up until now been the perpetrator of that business change it must be incredibly difficult to need to start reacting to things beyond their control. But as the article from TechCrunch linked above points out, Netflix was previously a reason not to bother with kiosks from Redbox and Blockbuster. Now, Netflix is the biggest reason to plunk down $1 on an overnight rental from a Blockbuster or Redbox machine down the street instead of waiting for a DVD to show up in the mail from Netflix.
I can’t explain this any way other than to assume that Reed Hastings believes he’s become omnipotent in the way that music labels incorrectly assumed they had.
Reed, I’m here for you. If you Contact Answer Guy Central, I’ll be happy to help you find better business change options than cheesing off your up-until-now loyal customer base.
Anyone else looking for their Netflix Replacement? It’s not like there aren’t lots of options, right?