Netflix is splitting its streaming and DVD services into separate brands, renaming the latter Qwikster, company CEO Reed Hastings announced in a blog post.
"...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," Reed Hastings wrote. "It?s hard for me to write this after over 10 years of mailing DVDs with pride, but we think it is necessary and best: In a few weeks, we will rename our DVD by mail service to "Qwikster"."
Qwikster will be the same website and DVD service that everyone is used to. It is just a new name, and DVD members will go to qwikster.com to access their DVD queues and choose movies. One improvement the company will make at launch is to add a video games upgrade option, similar to its upgrade option for Blu-ray, for those who want to rent Wii, PS3 and Xbox 360 games.
A negative of the renaming and separation is that the Qwikster.com and Netflix.com websites will not be integrated. So if you subscribe to both services, and if you need to change your credit card or email address, you would need to do it in two places. Similarly, if you rate or review a movie on Qwikster, it doesn't show up on Netflix, and vice-versa.
"Our view is with this split of the businesses, we will be better at streaming, and we will be better at DVD by mail, " Mr. Hastings added.
In July Netflix announced it would charge $7.99 a month each for DVD and streaming, angering consumers who had been spending $9.99 for both. On Sept. 15 Netflix announced it expected to lose 1 million more subscribers than forecasted.
Hastings wrote that the transition for DVD subscribers would be relatively seamless, and that the iconic red Netflix envelope would remain, with a Qwikster logo instead.