Netflix Spins Off DVD by Mail Service as Qwikster

Posted on September 19, 2011

QwiksterNetflix CEO Reed Hastings posted a lengthy post today offering an explanation and apology for creating customer confusion during the recent separation of its DVD and streaming service. He says his greatest fear is that Netflix will fail like AOL dialup or Borders.
For the past five years, my greatest fear at Netflix has been that we wouldn't make the leap from success in DVDs to success in streaming. Most companies that are great at something - like AOL dialup or Borders bookstores - do not become great at new things people want (streaming for us) because they are afraid to hurt their initial business. Eventually these companies realize their error of not focusing enough on the new thing, and then the company fights desperately and hopelessly to recover. Companies rarely die from moving too fast, and they frequently die from moving too slowly.

When Netflix is evolving rapidly, however, I need to be extra-communicative. This is the key thing I got wrong.
Netflix has now decided to spin-off the DVD by mail service into a separate service, which will be called Qwikster. Andy Rendich, the head of Netflix's DVD operations, has been named the CEO of Qwiskter.

The CEOs of Netflix and Qwikster also shared a video saying they should have given a better original explanation for the separation of the services. Take a look: