Netflix CEO Reed Hastings must be feeling a little bit like a team that ended up on the cover of Sports Illustrated and then started losing games. Last year, Hastings was on the cover of Fortune as its Business Person of the Year. This year, he’s getting slammed for what he acknowledges are a series of poor decisions and mishandled customer communications. It’s kind of like the dreaded SI cover jinx.
After raising the price for the Netflix DVD and movie streaming package over the summer, Hastings publicly apologized but didn’t change the terms of the deal. Then a few months later, he announced that Netflix was going to be just for streaming movies and a spin off company, Qwikster, would handle DVD rentals. Customers would no longer have a master movie queue online at one site. They’d have to go back and forth between the sites if they wanted both streaming movies and DVD rentals. Customers hated that idea and Netflix killed Qwikster a few weeks later. A lot of customers decided to just bail out. Netflix announced a few days ago that they lost 800,000 customers in the last quarter. The company’s stock has declined by around 35% in each of the past two days.
More of the Next Level blog post from Scott Eblin
