Netflix adds games to DVD-by-mail service

Netflix spins off its streaming service, renames its DVD-by-mail service Qwikster, adds video games upgrade option.

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Netflix has announced plans to split its DVD-by-mail and Internet media streaming services, spinning off its disc-based business as a stand-alone service named Qwikster. The company also announced it will add video games to its DVD service for the first time, launching Qwikster with a video games upgrade option that will let customers borrow PS3, Xbox 360, and Wii games.

Coming soon to Netflix: Games by mail.

In a welcome video, Qwikster's new chief executive Andy Reditch explains: "We're going to have games available as an additional charge, just like our Blu-ray [upgrade option]." There's no word on exact pricing yet, but in a post on the company blog, Netflix chief executive Reed Hastings also compares the game upgrade option to the service's existing Blu-ray upgrade option, suggesting it will cost a few extra dollars a month.

"Members have been asking for video games for many years, and now that DVD-by-mail has its own team, we are finally getting it done," writes Hastings. The Qwikster.com website will be launched in a few weeks, he says, and will be a renamed version of the Netflix DVD website, but with the addition of games; otherwise, the service will remain the same. "There are no pricing changes… You won’t have to do anything special if you subscribe to our DVD-by-mail service," says the blog post. The addition of games to Qwikster's mail-order offering puts it in competition with Blockbuster's similar movies-and-games subscription service and game rental service GameFly.

The separation of Netflix's online and offline divisions comes not long after a significant and unpopular price hike; in July, the film upped the cost of its unlimited streaming and DVD-by-mail package from $10 to $16 a month and created an $8 DVD-only option. In the same blog post in which he announces Qwikster, Hastings apologises for poor communication over that price bump and says he regrets not giving "a full justification to our members of why we are separating DVD and streaming, and charging for both."

Hastings writes that by splitting the business in two "we will be better at streaming, and we will be better at DVD by mail." By keeping the original company name for the online service, though, the company makes clear it sees its future in streaming. Qwikster, even with the addition of games, isn't talked up for its longevity: "DVD by mail may not last forever," writes Hastings, "but we want it to last as long as possible."

Discussion

101 comments
orb_03_2006
orb_03_2006

So long as it's cheap, I'm all for it.

huskerman34
huskerman34

Yeah they are after Gamefly's lunch. They will undercut the competitors prices like they did with the video rentals. Then when they become the sole provider of the digital entertainment industry, they will start screwing there fanbase. It will start out with a "I'm sorry but we are going to totally screw you"

be_skeptical
be_skeptical

Am I the only one who doesn't use Netflix at all? They offered a "free trial" on my PS3/X360, and my friends all said it was the bomb, so I was going to sign up. It turns out that a "free trial" still requires your credit card info, but you can "cancel at any time." I hit cancel and still was spammed with marketing e-mails. Thanks, but no thanks.

blackace
blackace

As long as the streaming and DVD package that is currently in place stays this way for current members, I'm fine. I don't mind get 1 DVD two to three times a week. I'm fine with the streaming service, even though they are missing a lot of movie and TV shows. I still always find something to watch that I've never seen. I'm thinking about giving Gamefly a try.

FallenOneX
FallenOneX

There's a reason that haven't announced the price yet......

servb0ts
servb0ts

the CEO wants to go outta bussiness like Time Warner.

4quarters
4quarters

unless they stay $11.99 or less I'm done and goin to Blockbuster, everyone seems to like their mail service...

mos2000
mos2000

HA! Now they're adding video-games to the mix. Unless they can do it faster and cheaper than Gamefly, they'd best forget it...

PixelAddict
PixelAddict

Wow a year removed from saying they will "NEVER have video games" This company is going down. As a marketing guy i cannot comprehend how they could destroy their brand more efficiently and effectively than the whole Netflix/Qwikster fiasco. Also, if streaming is the future, then the "portal" we view content through is NOT the future. The content is. Netflix' days are numbered, i'm afraid.

shaun_ofda_dead
shaun_ofda_dead

@gandaf007 I don't pretend anything, as a netflix customer for the last three years I am well aware of how they do things. All I am saying is that they alienated part of their customer base by jacking up the rate of the package by 67%. Thats a fact, not a pretend situation. Sure publishers want a piece of the netflix pie. They make a crap load of money. But at the same time, its not like Netflix is unable to make a profit. They have been making a profit since day one. And they will certainly continue to. But at least they could do their "loyal customers" a service and continue to offer quality streaming programs than the thrid rate crap that is being put up in the last few months since the price hike. This split certainly isn't going to help that is it?

MOwens9512
MOwens9512

I really don't understand why they felt they needed to split the brand, other than to signify that they will no long allow customers to rent discs by mail in the near future. They're caught up in the same sad and dillusional trend a lot of media industries are and slowly phasing out any physical format for digital. As soon as the price hike came I cancelled the streaming. While it's good for tv shows, I barely used it. And now with cable companies adding more content to their on-demand service (as well as allowing you to go to their websites and watch their content like HBO does), paying someone to stream in stuff isn't as appealing. Don't forget DVR either. It's not as consumer friendly as it seems either; pretty soon with everybody wanting you to download or stream stuff internet companies will feel (and be) more than justified to raise prices because of the strain on their bandwith by users going digital more and more. Last, Netflix had already been trending to trickling in new content on disc and I can see that getting worse. In fact I wouldn't be suprised if they do like Blockbuster or Gamefly and just have a regional hub instead of localized ones for discs, making the shipping and recieving time longer. Not a huge issue, but it would take away yet another reason why people loved Netflix over their competition. In the end you can't blame the companies though. It's a move that benefits them because it cuts their costs big time.

TrueProphecy22
TrueProphecy22

Netflix is losing Starz in January and working on losing HBO too. The selection just isn't as broad as I really expected it to be. Not to mention that they roll movies and shows out. I queued up a few James Bond flicks to watch later and the next month they'd been removed. Also not to mention that they always seem to have the sequels and never the original.

Santesyu
Santesyu

Netflix should just focus on what they are good at and thats movies and tv shows..be what you are good at. GameFly is good because it focuses 100 percent on games.. Netflix is trying to do to much.

PumpkinBoogie
PumpkinBoogie

@Link3301, Nah, not necessarily. See, the thing is this: sure in terms of speed Netflix may be able to do the trick; but Gamefly is like the 'Netflix' of gaming in terms of selection and choices. If Netflix/Qwikster can't meet or exceed Gamefly in terms of selection and availability, then speed don't mean s***. What's the point in being the faster service when you ain't got a thing available for gamers to rent? That being said, still it doesn't hurt to see a little extra competition in the game rental market. I'd be more interested to see how GF is going to handle/answer to this recent announcement. Will they change pricing; speed up delivery? We'll see.... @jmrwacko, I agree w/ you as well. That's one of the reason I didn't hesitate to drop the dvd/blu-ray part of our account before the price hike. I never liked that crap anyway that I even had to pay extra for blurays rather than them just offering a bluray plan that allowed you to have blurays only (w/ maybe an option to ADD dvds for a few dollars more); nor do I get why they're still doing this bs w/ their upcoming game add-ons. Why are they so inclined to push the dvd renting so hard on those that might not even want dvds at all? They're going to have to offer some serious gamers only options if they expect to pull a lot of people away from GF.

okassar
okassar

I would have understanded a 20 or 30 percent price hike, but 100%? Forget about it.

soulless4now
soulless4now

I'm already pay enough for netflix as it is and if I wanted to rent games, I'd rather use gamefly or redbox.

sdfreediver
sdfreediver

Netflix 1 DVD out at a time + Blu Ray = 11.99 per month "We're going to have games available as an additional charge" Blockbuster 1 DVD out at a time + Blu Ray + Games = 9.99 per month I will be keeping my Netflix online streaming, but bye bye qwikster....

tuproc2004
tuproc2004

Forgot to add that you lost the contract with STARZ which is the only way to watch a halfway new movie on streaming d-bag! in march they lose their biggest streaming contract and will be left with a crap list of movies to stream, but lets add more money to the dvd rental too and add games that wont even be in stock if you try to rent them..wow netflix is going down

president_bush
president_bush

I cancelled the DVD service of Netflix, because they didn't have the whole series of Full House, just seasons 1,2,3,4, and 8. Crazy!

Evenios
Evenios

that is a very stupid name for the DVD service it sounds cheap they should have just kept the name for both called it Netflix Streaming and Netflix Disks or something like that... i cancelled my subscription as im not happy with the changes

Thug2Wasteland
Thug2Wasteland

Not a bad idea...but I wish the prices didn't ruin it..

mrsniper83
mrsniper83

I probably just go with Gamefly.

JasPlun
JasPlun

@CarissimiRBeast I do not know the exact numbers,but I know it was over 1 million multiply that by several months and it totals huge losses.If I ever decide to rent games I will go with Blockbuster online most likly or Redbox.Only way I would ever go back to Netflix is a complete reversal on their part period.

moviequest14
moviequest14

Netflix seems to be always doing 1 step behind,gamefly comes out shipping games and netflix takes WAY to long to come out with their version and now Gamefly is going on-console and it will probably be several years before netflix follows suit (game-wise).

CarissimiRBeast
CarissimiRBeast

@JasPlun I thought it was more around 2 million subs lost. But seriously this guy is an total dbag. He's splitting netflix into 2 parts so people will forget about the price hike. Now he can incur super fees on both and less people will care. I dropped thier services after I got the email.

HaloPimp978
HaloPimp978

I canceled my netflix after the hike, it is just ridiculous.

SoNin360
SoNin360

Well, it will be interesting to see if their service for video game rentals top GameFly. But it doesn't even sound like you can just do video games by mail, rather it's merely an addition to the DVDs. Idk, I may have read that wrong, but I'm not interested until I see prices...

WllDan7
WllDan7

Soon Netflix will rule the world.

Son_of_Bmore
Son_of_Bmore

Well won't b getting any EA games by mail

Crono1321
Crono1321

Blockbuster makes you wait months for any new games. Resistance 3 is up to 12/4/2011 last time I checked.

Jurassic85
Jurassic85

Think about how many people use netflix, and how long it will take to get any game that you want to play in the mail. The queues will be ridiculous. I love netflix's streaming, and I have a reasonably priced game rental service that I will stick with.

JasPlun
JasPlun

When your CEO has to go public and apologize after costing the company over 1 million subs you know its only going to get worse,why this guy has not been fired is beyond me.At my job if I made an error they would probably give me a warning,if I made a huge error that gave them a bad reputation and cost that much I would be canned on the spot lol.

JasPlun
JasPlun

Funny Blockbuster Online includes game rentals with your sub at no extra charge.

antoniobandino
antoniobandino

They can never reach the level Gamefly is at; a dedicated company like Gamefly, already established with five warehouses and seriously fast shipping times can't be toppled, especially when they've already had years to smooth out any kinks. And also, their free trial is fantastic!

DarkZxion
DarkZxion

My guess is that to get the video game upgrade it will cost around $10. And if by "we will be better at streaming..." you mean that you will offer every single movie you have available to stream then good. If not, I see no reason why you changed in the first place.

Master_Turismo
Master_Turismo

I'll just stick with my local Redbox and my Steam account. Besides that and the ridiculous price hike, Netflix did a pretty bold move. Going right after Gamefly and Blockbuster all at once is pretty out there.

devilscry
devilscry

still doesn't make sense why they changed the name. can't it just be called, Netflix Disc and Netflix Streaming? they're just going to confuse people and further piss people off.

Khasym
Khasym

I think there's more to this than what we're seeing. Netflix got crippled a little bit a while back, when the studios restricted netflix from renting new releases for the first 28 days. But recently, I checked Netflix, and they're offering Thor, a big name title, is on Netflix for regular DVD rental a week later. maybe that deal no longer applies, which means a LOT of industries are about to feel a renewed force from Netflix. Splitting their DVD-by-mail service off, adding games to the rental system, and losing(perhaps DITCHING) Starz, may mean that the studios are finally ready to start dumping cable subscription services, and just put their content directly onto Netflix and Qwikster.

Mephers
Mephers

Meh, my family and I all cancelled our netflix plans already due to the rediculous price hike. Give us a bit more incentive to come back - money wise. Everyones wallets is feeling it and we dont have time or energy or money to spend on overpriced crap. Thats why pirating is getting out of hand - everyones trying to overcharge too much.

nitroRCman
nitroRCman

My Gamefly games take 5-7 days avg, yet Netflix is 2 days avg...this will make me switch if their mailing speed remains quick. I'm even a couple states over (in MI) from one of Gamefly's locations and it still takes forever

procterorange
procterorange

Blockbuster by mail for games is lame. Just check out the release dates for the newer games. Let's say a game you wanna rent comes out in Sept., you might get to play it by Nov. For some reason or another. New released games by mail are only available after 2 months or so after they come out. Unless you have a serious back log, Blockbuster for games is not worth it.

raahsnavj
raahsnavj

Sweet. Too bad I cancelled the disc service because of their 100% rate hike.

JoSilver
JoSilver

Netflix has betrayed us... why should we go back. :(

bxr2urjaw
bxr2urjaw

who cares about blockbuster there hanging on to a freaking thread for customers as is, i can use my xbox for netflix which is way easier then getting sh!!t in the mail and mailing it back, ppl who keep complaing about prices obviously cant afford it anyway so go back to borrowing from a friend or get a better job

Archias
Archias

Eh. I pay $19.99 at Blockbuster.com for 3-at-a-time DVD+BluRay+Games. That was coming from Netflix at $19.99 for just 3-at-a-time DVD+BluRay. An additional upgrade cost will make it more expensive than Blockbuster, for the same features.

lextexrex
lextexrex

Like others have mentioned here, streaming games is most likely their next step. They've already incorporated themselves into every current gen console. People are getting a bit worried though that Sony and Microsoft are gonna lose out. Well let me put down those concerns by letting you know that there is this thing called "royalties"... (which just so happens to also apply to movies and tv shows you already watch on Netflix)

drswank
drswank

@Link3301 - You might just be right. If they can get games to me as fast as they get movies, they'll have my business. Not into waiting 4-5 days for Gamefly.

RE2LeonS
RE2LeonS

Who cares about Gamefly or Netflix, Blockbuster Mail-ins have been doing this forever now! You can get video games from Blockbuster mail-in orders too!