Discussing: Netflix and The Streaming Business

As probably everyone knows by now, Netflix is separating their two aspects of service into different subsidiaries. The name Netflix will stay with the streaming service they provide and the DVD mailing service will be called Qwikster. The general consensus to this announcement seems to be universally negative and following the price increase earlier this year, Netflix is no longer as beloved as they make questionable decisions. The backlash is understandable. People don’t adjust to change well, especially when they enjoy the service the way it is as much as most do with Netflix. The software for the service is now being including into televisions directly as a result. I’m sure there are some manufacturer that are less than happy with the decision as it lowers the amount of people who would’ve associated Netflix with DVDs or had the service just because they had DVDs mailed to them.

An aspect to keep into account would be the progress in technology over the past 15 years or so. New advancements are occurring so rapidly that it’s hard to keep up. Netflix is one of the biggest successes currently and many people are enjoying the ability to watch anything offered to them instantly and what isn’t, they can have it mailed to them. However, a majority of people have stopped enjoying the DVDs and are using the streaming service more. The main reason for this is that with each passing year, DVDs are becoming obsolete. High Definition is the new standard now and any new TV you buy will be in HD. DVDs can’t display HD visuals and therefore will go the way of the dodo soon. It’s true that BluRay is the answer to the physical media side of this argument but the format hasn’t caught on as much as DVDs did in the early 2000s.

The internet is much more powerful than it was in the mid 90s and speed is constantly increasing. Dial up is no longer a sound option and 768 kbps is considered slow. I personally get around 12 Mbps and that’s the second cheapest option available to me. Because of this instant gratification, waiting for a physical disc that could be in rough shape to see a movie doesn’t make as much sense as having a movie downloaded onto your device of choice and only having to wait a hour or two. What Netflix offers with its streaming service proposes a even better idea. For a small fee (now 7.99 a month), you can watch any movie or TV show instantly, no downloading required. You don’t own anything but it’s there for you as long as Netflix has the license to do so. What’s more is it’s in HD at no extra cost! A quick check on your display’s specification will instantly display the video in SD or HD.

BluRay may be a great way to display movies and shows but streaming media gives the viewer a level of convenience discs and physical media can’t. Netflix itself seems to be careful with new ideas. They offer BluRay but only as an add on service, something that isn’t promoted as much. The company had the insight to see that BluRay wasn’t the future. Streaming media is and now the company sees that it needs to distance itself from physical media because it will not last as a profitable endeavor. Of course, for now, it still is. Which is why Qwikster exists.

Aside from the strange name (as a English major, this trend of misspelling things vexes me something awful), Qwikster is basically a placeholder for a medium they seeing as dying but still profitable currently. Through this new subsidiary, you can rent DVDs and, for an extra two bucks, BluRay discs. They are also now going to offer video games for an additional fee, one I’m not sure of as of now. The aspect of a challenger to GameFly’s mail in video game service seems to be an effort to show Qwikster as improvement over the combined services Netflix provided. The seriousness of this new service hasn’t been revealed but I don’t expect it to be something GameFly has to worry about. It reminds me of when I was younger when I went to the local video store with my mothers. They would rent a few movies while I rented a game or two with my allowance that week. This is a way for parents to get something for their son while they get what they want all in one bill.

In summation, some of the negative attention should really be attibuted to the handling of this transistion rather than the action itself. Change is always going to happen and even this shows just the same services staying the same albeit being separated. The pricing of the services is still rather much but the silver lining should be that we will get more movies and TV shows on Netflix soon. This company is trying to stay ahead of the curve and time will tell if they are successful or if they’ve made a dire mistake. I’m not sure Netflix should worry about being the next AOL though.


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