In only three months, Netflix managed to loose almost one million subscribers. Although only a few months ago, during summer, the company stock market was doing well and the advertisements for its services were everywhere, the past three months brought a completely new situation in place, as over 800,000 subscribers chose other companies.
The company watched its stock peaked in mid-July, only to witness their shares fall 61% in nearly three months to finish on Monday to a stunning 28%. Mercury News reports that the subscribers flee was the outcome of several missteps Netflix took the past months, culminating with the price hike. The price for the company’s DVD and streaming video services were raised with up to 60 percent. Besides Netflix has a project in the making, Qwikster, that was supposed to split the two services it provided, the DVD renting and online streaming.
Yet, a recent report from Associated Press, reveals that the company is reluctant to set this project in motion any further and will most likely abandon it. Customers have discarded the idea of making two different accounts, manage them separately and most importantly pay more than they used to for the same services.
Netflix was in a free fall and some decisive action from the company management was imminent. In a blog post on Monday, Reed Hastings Netflix CEO revealed his company’s plan to return to the previous service pack since customers weren’t comfortable with the idea of having to manage two website accounts. Thus, Netflix is returning to the per- Qwikster period when the service pack was more beneficial for both costumers and provider alike. “It is clear that for many of our members two websites would make things more difficult” he wrote on his blog post.
This decision had an immediate effect on the share market as the company’s share value rose with 7.4 percent, going up to 125.84 dollars.
Forbes considers that “NFLX surged into the close Friday and is up in the pre-market, so it looks like we may see a little run into the report”.