(Editor’s Note: For a more recent blog on Netflix pricing changes, click here.)
Netflix has accomplished a lot in its lifetime. It is the key player responsible for a wholesale change of an entire industry. Physical video stores have dropped like flies in the wake of the mail order DVD rental business that Netflix pioneered, with only Blockbuster still hanging around, although by a thread.
Now, in its effort to further transform the industry away from physical DVD rentals in favor of online streaming options, it has made several customer service blunders and angered its subscribers. Instead of communicating changes to its service far ahead of time or promoting new features and trying to entice customers away from physical DVD rentals, the company is simply making changes that force customers in that direction. And it’s ticking those customers off. Call it “Facebook Syndrome,” an unfortunate condition in which you wake up one morning to find the online service you love has been overhauled without warning. And most of the time not for the better.
Netflix hasn’t been coy about its eventual goal to get out of the mail order entertainment business. It might not have the overhead that a Blockbuster does with the need for physical stores, but its shipping costs and logistical challenges are still pretty expensive in their own right. Consumer taste is also shifting towards online viewing as more people have access to broadband Internet and new streaming devices. Netflix’s desire to get ahead of the curve and embrace those changes is admirable (and a lesson Blockbuster never learned), but it sure doesn’t execute them well.
The latest snafu was a brief blog post on the site telling customers that they will no longer be able to add movies to their mail order DVD queue from streaming and mobile devices. Seems simple enough, but the change set off a flurry of angry responses from customers. Many of them liked having the ability to add a movie to their mail order queue if it wasn’t available for streaming. Now they have to fire up the computer to do it from the website.
This came on the heels of new pricing structures that favor streaming customers over mail-order ones, a surcharge for Blu-ray discs and changes to the site so online options are more prominently featured. It’s pretty ironic, really. As Netflix seeks to change its model, it’s alienating the very customers that made it so successful to begin with.
Not only that, but the company is putting the cart before the horse. The service simply doesn’t have much of a selection yet of titles available for instant viewing. We recently purchased a Wii as a family holiday gift. It gave us games for the kids and Netflix streaming for the grown-ups. So far I’ve loved being able to access content on my television (Hello, Dexter marathon!) but all too often when I look for the impulse movie, it’s not available. That’s fine, I get that it takes time and money to build a healthy library of content. Plus, a lot of providers don’t want their content available on Netflix (I’m looking at you HBO). Until Netflix solves that problem, forcing customers onto a sub-par service isn’t just a bad idea, it’s bad business.