Skip navigation
Annenberg School of Communication and Journalism University of Southern California
Nation/World

Netflix Splits DVD Service Into New Company Qwikster

Netflix announced the division of its company Sunday into two separate companies, Netflix and Qwikster.

Netflix has restructured its business by divorcing its movie-streaming feature from its DVD-by-mail service.  The new system will charge customers seprately for the two services, where before it was all included under one price.

AP
AP

The newly independent DVD-by-mail service has been renamed Qwikster.  Qwikster is a subsidiary of Netflix and operates from a separate website.  Netflix will remain a movie-streaming website. 

Qwikster's launch announcement was buried in a blog post by CEO Reed Hastings in which he apologized to customers for the terrible stock performances when share prices crashed 19%.  The plummet came as a result of Netflix's sudden price increase from $10 per month to $16.

Hastings explained in his blog post that the creation of Qwikster was the reason behind the price hike that so infuriated customers.

"We realized that streaming and DVD by mail are becoming two quite different businesses, with very different cost structures, different benefits that need to be marketed differently, and we need to let each grow and operate independently," Hastings said.

He went on to try to placate customers by describing the benefits of the new system, one of which includes an expanded selection of videogame titles for multiple console systems.

"One improvement we will make at launch is to add a video games upgrade option, similar to our upgrade option for Blu-ray, for those who want to rent Wii, PS3 and Xbox 360 games," Hastings said. " Members have been asking for video games for many years, and now that DVD by mail has its own team, we are finally getting it done."

 

RELATED:

Neon Tommy: Netflix: We're Sorry, We've Changed the Name of Service Now

COMMENTS
Leave a comment
Name:
E-mail:*
URL:
Comments:*

USC Employees Protest Low Wages


By Brad Streicher
01/30/15 | 10:18 a.m. PST

USC students and workers protested across campus on Thursday night asking the university to raise wages for USC employees. Protestors...

Leonard Williams Declares for 2015 NFL Draft


By Alyssa Nakamoto
12/29/14 | 12:34 p.m. PST

The junior defensive end is expected to be a Top 10 pick.

Sports SCene: Episode 1

CNN Staff And Alumna Stop By The Media Center

Voices of Auschwitz

Javorius 'Buck' Allen: "It Was a Very Physical Game"

We detected that you might be on a mobile device such as an iPad or iPhone. Sorry, at this time the video box is only visible on desktop computers.
MOST POPULAR

Announcing The Spring 2015 Anchor Team


By ATVN
01/25/15 | 9:46 p.m. PST

Thank you to everyone who auditioned. We invite you to audition next semester. 

Sports SCene: Episode 1


By Alyssa Nakamoto
01/28/15 | 9:08 p.m. PST

The Annenberg Media Center presents the first episode of Sports SCene, a show dedicated completely to USC sports.