Even before it arrived, Qwikster was doomed. Netflix (Nasdaq:NFLX)’s attempt at spinning off it’s DVD business has led to thousands of negative complaints among its users. After annoying customers time and time again and watching its stock prices flounder to almost a third of its price just a few months ago, the company has decided to back off its reorganization plans.
It all started when Netflix raised its prices and announced that it was splitting its streaming video service off of its mail based DVD rental service. Jacking prices from under $10 to almost $16 in a short timespan caused a significant chunk of subscribers to leave the service for competing ones such as Hulu and Amazon Prime. Fierce competition prevented Netflix from re-signing its exclusive deal with Starz despite an enormous proposed increase in money.
With Netflix going down the tube, could this be the sign of another bubble bursting? Is this simply a case of too many fish in a little pond with over five times more competition than two years ago? All we can tell is that Netflix needs to re-energize its customer base to keep it from crashing and burning.