Netflix has announced that it will separate its DVD-by-mail service into an entirely new website called Qwikster, and all I can think is that they should have named the thing SpringtimeForHitler.
For those that haven't seen "The Producers" (available on Netflix via streaming and, for now, DVD), the classic Mel Brooks comedy follows a theater producing team that hatches a scheme whereby they make money if their new show does poorly; to do so, they come up with the worst musical they possibly can, a jubilantly offensive abomination about the Fuhrer called "Springtime for Hitler."
Now, I am not suggesting that Reed Hastings is setting up Qwikster to fail as loudly and quickly as possible. If this is some kind of genius ploy to make movie studios realize that DVDs are an outdated technology that consumers no longer want, then I will prostrate myself before Hastings and congratulate him on his brilliant strategy at a later date.
I do not think this is the case, however. Given how this launch was carried out, and considering the implications of splitting your two bread-and-butter services into separate websites, I can only imagine that Hastings has seriously overestimated Qwikster, its appeal to consumers, the way it impacts the Netflix brand and the way current customers view his companies and the way they are being managed.
It may be possible that Hastings does not care whether Qwikster succeeds and that spinning off the DVD rentals (and a new video game rental service) will allow Netflix to more effectively pool its money and resources toward the acquisition of better content for its streaming library--just might be true and more than one bright writer has suggested the possibility. Both TechCrunch editor Erick Schonfeld and Engadget editor Darren Murph have endorsed the move for that very reason in separate posts.
But while, from a business perspective, this great schism may be the wise move (75 percent of new subscribers to Netflix go streaming-only), from a consumer image perspective everything involving Qwikster ranks somewhere just above "catastrophe." This is bad news for a company whose public image sits below that of Blockbuster's, that will lose Sony and Disney movies from streaming in 2012 and that just announced it will lose one million more customers than it thought it would. The last thing Netflix needed to do was announce Qwikster, and then it went ahead and announced Qwikster (with, I will add, a YouTube clip that looked like it was made in three hours by a bunch of high school freshmen on day one of Introduction to Video Production).
Editing qualities aside, let's take a look at all the reasons Qwikster, from announcement to timing to execution, is an awful, awful idea:
1) Hastings' Apology For The Price Hike Came Three Months Too Late
Netflix announced on July 12 that it would raise its prices. Hastings apologized for the way he and his company handled and responded to the price increase in a blog post on September 19. A friend of mine noted that his apology ("I messed up") read somewhat like an ex-boyfriend's plea for forgiveness after a particularly nasty fight the night before. I agree.
Problem is, that nasty fight happened two months ago, and people were just starting to forget the unpleasantness. And you know, even though Hastings waited 60 days too long to apologize after repeatedly declining to do so in public appearances, at least he swallowed his pride eventually, right? The problem with that, though...
2) Netflix Just Put A Band-Aid On Our Cut And Then Stomped On Our Foot
The apology was not an apology in itself; it was an apology attached to an advertisement for a product launch--and not just any product launch, either: a stupid one! Even if Qwikster is meant to torpedo itself and allow Netflix to focus on the better streaming library that everyone wants, then Netflix has done an awful job of communicating its reasons, once again taking to its blog with an overly cheery post that assumed customers would receive the news rationally and with acceptance.
Not so. Top comment on the blog post: "Seriously, you thought a good idea to make up for miscommunications was to separate the websites and make it more complicated for us to manage our queues? Really?"
This gets at the heart of one of Qwikster's major defects (it has several). I mean, really, Hastings surely must have known that...
3) No One Wants To Log In To Two Different Websites
Even though Netflix had hiked its subscription price for customers who wanted streaming and DVD services, Netflix at least had the benefit of unification. DVDs and streaming on one website, with one user login? What providence! What ease-of-access! According to Netflix's most recent statistics, 12.2 million subscribers are currently taking advantage of such providence and ease-of-access.
That's gone now. The great convenience of having DVDs and streaming on one site, with the ability to search for a film, check which medium it is available for and then reserve that film, will soon be gone. You'll have to search the two services separately, once Qwikster opens its doors. It is unclear how many of those 12.2 million (plus an additional 2 million that are DVD-only) will stick around for Qwikster. It's another blow to customer convenience and another blow to the consumer perception that Netflix has their best interests in mind. And what's more...
4) No One Wants To Get Two Statements On Their Credit Card When They Could Be Getting One
Speaking of blows to customer convenience: The split of DVD-by-mail and streaming into separate companies means that you have to fill out your credit card information twice if you want to receive both. As a Netflix user, I currently only subscribe to the streaming, but I can only imagine the advent of Qwikster will do anything except drive even more DVD rentals to Redbox, possibly even to the still-twitching Blockbuster.
Honestly, though, the worst part about Netflix's new DVD service is not that it requires a separate login, or that it will require two different credit card charges, or that search-and-save across DVD and streaming has been eliminated; no, the worst part of Qwikster is...
5) The Name "Qwikster". Seriously? "Qwikster"?
It is as though Hastings and the Netflix crew sat in a room and brainstormed the dumbest possible names they could think of and knew they were really onto something truly stupid when they came up with Qwikster. In the same way that a jolly musical about the life of Adolf Hitler is immediately recognizable as a terrible concept for a stage production, so too is anything that is not a one-off iPhone app for photo uploads named Qwikster. My first reaction, when I heard the news, was, "Hey Qwikster, 1991 called, it wants its radical new company name back."
In his blog post, Hastings explains the name choice thus:
We chose the name Qwikster because it refers to quick delivery. We will keep the name “Netflix” for streaming.
Problem is, "Qwikster" does not refer to "quick delivery"; it refers to "qwik delivery," and "qwik" is NOT A REAL WORD. Granted, "flix" isn't a real word, either, but "Netflix" is somehow far less enraging than "Qwikster."
I mean, seriously, "qwik" isn't a word, it's a pronunciation guide.
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Netflix, it seems, has enraged its customer base once again, though the Qwikster debacle does not affect nearly as many people as Netflix's price hike did. Frustration with the company is mounting; consumers are losing faith in the leadership, if the reactions on Twitter and the Netflix blog are any indication. Indeed, Reed Hastings himself is doing damage control by personally responding to some fairly hateful comments on his original blog post.
After the loss of Starz, another minor body blow, I wrote that Hastings and Netflix needed to do something demonstrably positive like inking a deal to stream HBO content ; Qwikster makes this even more necessary. Unless Reed Hastings has shorted a whole bunch of Netflix stock, it is time for him and his company to really improve Netflix's streaming side, to take some of their money and do something positive with it, and qwikly.