Monday, September 19, 2011

The Netfilx (non-)apology Email

The Netfilx (non-)apology Email

I think the email that Reed Hasitngs (from Netflix) sent today may have the opposite reaction than what he is hoping for.

I, for one, got mad when I read it.  Hastings is insulting our intelligence, it seems that making millions (billions?) off of us has made him lose touch with us.

So here is my personal reading-between-the-lines interpretation of Reed's email:
Dear George ('Dear [insert first name here]'),

I messed up (you caught me). I owe you an explanation (we are hemorrhaging so many customers and stock holders that I need to try to plug the leak).

It is clear from the feedback over the past two months that many members felt we lacked respect and humility in the way we announced the separation of DVD and streaming and the price changes (how the heck did you all see through our scheme to try to double our already sizable profits while not give you any more value for your dollar?!?). That was certainly not our intent (that you realize what we were doing), and I offer my sincere apology (I'm sorry that you weren't stupid enough to swallow our B.S.). Let me explain what we are doing (let me see if I can try to trick you a different way).

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 (we dominated DVDs and streaming to the extent that we put most of our competition out of business, but I want you to feel sorry for us). 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) (if I compare us to failed companies, maybe you'll feel sorry for us, even though there is no real comparison since we are dominating the area I am trying to make you think we are failing at). So we moved quickly into streaming, but I should have personally given you a full explanation of why we are splitting the services and thereby increasing prices (even though we have been streaming for years and still making huge profits, I want you to think it's a new venture on our part). It wouldn’t have changed the price increase (I still don't feel bad about putting the screws to you), but it would have been the right thing to do (maybe I could have staved off losing some of our victims, er... I mean 'customers').

So here is what we are doing and why (at least I hope you'll buy into this).

Many members love our DVD service, as I do, because nearly every movie ever made is published on DVD. DVD is a great option for those who want the huge and comprehensive selection of movies (we are great, worship us).

I also love our streaming service because it is integrated into my TV (oh, you don't have one of those TVs yet, too bad, they are quite nice), and I can watch anytime I want (BUHAHAHAH, oops, ignore the maniacal laugh). The benefits of our streaming service are really quite different from the benefits of DVD by mail (even though we have already been able to bundle the services and still make huge profits, I want to make you think it's a hardship for us). We need to focus on rapid improvement as streaming technology and the market evolves (we have already got all the technology in place, but I think we can double our profits), without maintaining compatibility with our DVD by mail service (I want you to think that it is a burden to do two things while still making amazing profits).

So we realized that streaming and DVD by mail are really becoming two different businesses, with very different cost structures, that need to be marketed differently, and we need to let each grow and operate independently (Hahahaha, I can't even say that with a straight face).

It’s hard to write this after over 10 years of mailing DVDs with pride, but we think it is necessary (how dare you make me pretend to grovel): In a few weeks, we will rename our DVD by mail service to “Qwikster”. We chose the name Qwikster because it refers to quick delivery. We will keep the name “Netflix” for streaming (maybe if we try to confuse you simpletons by making up a stupid name for the DVD service we can still get away with this).

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 to access their DVD queues and choose movies (even though we are trying to confuse you, we need to try to make it simple enough for you to still give us your money). One improvement we will make at launch is to add a video games upgrade option, similar to our upgrade option for Blu-ray, for those who want to rent Wii, PS3 and Xbox 360 games (we got games now, is that enough to get you back?). Members have been asking for video games for many years, but now that DVD by mail has its own team, we are finally getting it done (maybe you dummies will believe we couldn't figure out that we can send DVDs and game disks unless we split DVDs and streaming apart). Other improvements will follow (Hahaha, yeah, right). A negative of the renaming and separation is that the and websites will not be integrated (we could have integrated the sites, but we didn't want you to think it was easy to do two things on the same site, like we used to do).

There are no pricing changes (we’re done with that!) (the stockholders already want my head on a platter). If you subscribe to both services you will have two entries on your credit card statement, one for Qwikster and one for Netflix (haven't I gotten you to believe we can't do two things for one price yet?). The total will be the same as your current charges (even though it's more than twice as much as it was a few months ago, I want you to think it's not that much more). We will let you know in a few weeks when the website is up and ready (those idiot coders haven't gotten the site working yet, I'll have them disemboweled when they are finished).

For me the Netflix red envelope has always been a source of joy (money, money, money). The new envelope is still that lovely red, but now it will have a Qwikster logo (you morons need to feel like it is the same, even though we want you to think it's completely different). I know that logo will grow on me over time, but still, it is hard. I imagine it will be similar for many of you (I imagine you are all like Rain Man having to watch Wapner at the same time every day, you idiots).

I want to acknowledge and thank you for sticking with us (thanks for still giving us some of your money, but I want more), and to apologize again to those members, both current and former, who felt we treated them thoughtlessly (I still don't know how did those idiots could figure out we were just being greedy).

Both the Qwikster and Netflix teams will work hard to regain your trust (Jedi Mind Trick: "believe our lies"). We know it will not be overnight (hurry up). Actions speak louder than words (just don't pay attention to our actions). But words help people to understand actions (maybe you will believe me if I say you are stupid unless you believe me).

Respectfully yours (yeah, right),

-Reed Hastings, Co-Founder and CEO, Netflix (worship me by sending me your money)

p.s. I have a slightly longer explanation along with a video posted on our blog, where you can also post comments (if you still don't buy this lie, I want to try again on our blog).
The comments above (in red) are just my opinion of what I imagine was really going through Reed's mind as he was writing this email.

I dumped the DVD option on Netflix (I can get more DVD value for my money from Redbox now), as soon as I can find a streaming service that is at least comparable to Netflix then I will use it instead.