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Pull It Together, Netflix!

Erratic behavior: Netflix quits Qwikster, continues to dig own grave

Netflix took 22 days to realize that splitting up their service into two separate websites was not a good idea and has scrapped the plan all together. In a new blog post detailing the reversal, CEO Reed Hastings wrote “It is clear that for many of our members two websites would make things more difficult, so we are going to keep Netflix as one place to go for streaming and DVDs.”

The announcement is just another sign of Netflix’s recent erratic behavior and has elicited mixed responses from analysts and subscribers. On Netflix’s Facebook page, user posts have varied in reaction to the news. Some are praising Netflix for finally listening to their subscribers while others are not as forgiving and wonder how many times Netflix can mess up before enough is enough. Analysts have called the move desperate, and others worry about the long-term effect the reversal will have on the company.

In Reed’s apology last month, he claimed that Netflix would work hard to regain the trust of their subscribers. As a subscriber, I must say they’ve been doing a pretty lousy job at regaining my trust. Sure, I can forgive the company for this misstep. The idea of rebranding their DVD service as Qwikster never seemed logical in the first place and acknowledging this mistake seems to be a step in the right direction. But the flip-flopping coupled with Netflix’s recent woes make it harder and harder to be confident in the company’s future. 

Now I realize that in the past, companies have been able to rebound from rolling out a product that customers weren’t satisfied with. Coca-Cola’s New Coke is a good example of this. They rolled out New Coke in 1985 and in just less than three months, reverted back to the classic Coke and still lived to tell the tale.

But I’m not sure Netflix will be so lucky. The company is stumbling at a time when competitors such as Amazon and Hulu are on the rise and gaining in popularity, making it easier for disgruntled subscribers to abandon ship. (Here's a look at how Netflix, Blockbuster, Amazon and Hulu all stack up against each other in the streaming content business via PaidContent.)

Hollywood studios and cable programmers aren’t making it any easier on Netflix either. The studios have caught on to the amount of money they can make from streaming content and have made streaming their collection of movies and TV shows considerably more expensive for Netflix. 

Analysts, customers and even non-subscribers are certainly on the watch for the Netflix’s next move, wondering whether or not the company can ever rebound from their downward spiral. As much as Netflix has disappointed me, at the end of the day, I have a small glimmer of hope that they will pull through. After all, have we forgotten about the days of $5 movie rentals coupled with insurmountable late fees? I sure haven't. 

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