Explaining Southern California's economy

Memo to Netflix: Just tell customers what you want to do

Netflix CEO Reed Hastings has stuck a fork in Qwikster, the briefly lived spinoff of the company's DVD rental business.

Netflix has backtracked on plans to spinoff its DVD-rental business into a separate company, Qwikster — a bad move that has been resoundingly ridiculed everywhere bad moves can be resoundingly ridiculed. The cost is that CEO Reed Hastings now looks like a nincompoop, whereas before the Qwikster debacle he looked like a man who knew the future.

That's part of the problem, of course. Hastings grasped that the DVD business wasn't sustainable over the long haul. The future lay with online streaming. But to build that business, Netflix needs to license more content from TV and movie studios. The game plan was to raise subscriptions to generate the needed revenue and begin to phase out the old DVD business.

Hastings has been speaking directly to customers via Netflix's blog. His message is small miracle of concision in the ongoing hell that has been the needless messing-up of once-beloved, now-embattled Netflix:

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Reportings: No grocery strike; pulling a Qwikster; space boom; Jarritos!

The grocery workers union comes to tentative terms on a new contract with the Big 3 chain stores in Southern California. No details, but early indications are that the stores made concessions on health-care funding. But this would be a take-back from the 2007 negotiations, when the union and the chains agreed to underfund the healthcare surplus. (KPCC.org) 

 

Netflix (NFLX) is getting hammered again today, after the decision to spin-off the DVD-by-mail business into something called "Qwikster," which is now dangerously close to to becoming a word that people use to characterize the destruction of market value. "Remember those guys?" "Yep, they were riding high and then they pulled a Qwikster." Sort of reminds me of Research in Motion (RIMM) introducing a tablet with no native email. #Fail (Google Finance)

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