Map
Case

Netflix: splitting DVD and streaming, then cancelling Qwikster (2011)

Netflix launched its streaming service in 2007. In July 2011 it separated its DVD-by-mail and streaming plans, raising the price for members who took both (Netflix Form 10-Q). On 18 September 2011 Reed Hastings announced that the DVD service would be renamed Qwikster; on 10 October he cancelled the plan but kept the price change (Netflix blog). In the third quarter of 2011 domestic churn was 6.3% (second quarter: 4.2%) and Netflix lost a net 0.8 million domestic subscribers (10-Q).

Industry
Video streaming and DVD rental (USA)
Frameworks applied
Six recurring-revenue models
Clipboard with a glass checklist panel, icon for consulting

Frameworks applied

This case is read through the frameworks below.

  • Six recurring-revenue modelsWhen a business owner wants to move from one-off sales to recurring income, which model should they choose so that the same customer keeps paying over time?

Sources

References

Listed A–Z by author surname, Harvard style. A source with a DOI links to https://doi.org/…; one without links to its page or says plainly that it has no DOI.

  1. Hastings, R. (2011) DVDs will be staying at netflix.com. The Official Netflix Blog.No DOIblog.netflix.comSource page
  2. Hastings, R. (2011) An Explanation and Some Reflections. The Official Netflix Blog.No DOIblog.netflix.comSource page
  3. Netflix, Inc. (2011) Form 10-Q for the quarterly period ended September 30, 2011. Washington, DC: U.S. Securities and Exchange Commission.No DOIsec.govSource page