Feb. 17, 2012 at 1:21 PM ET
Despite its commitment to streaming movies and TV, Netflix is offering its DVD-only service option to new customers again, but will it tempt those who have converted to Redbox?
When Netflix implemented in September its highly unpopular plan to separate its DVD and streaming plans and 60 percent price hike (which met with vehement social media scorn for days and weeks following the announcement in July), it removed the DVD-only option for new customers, making it available only as an add-on to a streaming plan at sign-up for an additional $8 a month (one DVD out-at-a-time).
For a brief time, Netflix teased (and further irritated) members with the promise of a DVD-only spin-off called Qwikster, but that never materialized.
Now a blog post on Netflix's US & Canada blog by Santosh Hegde, director of DVD engineering, tells us that, starting at that same $8-a-month price, new customers (or those that left and could be tempted to come back) can now "enjoy around 100,000 titles on DVD." They're even giving away one-month free trials.
We've got to ask, is it too little, too late? (Take our poll and let us know.)
By the end of 2011, Netflix's actions — including the Qwikster debacle — showed public relations were not its forte. Even after a mass-emailed mea culpa from CEO Reed Hastings, much of the good will Netflix built up over the years with its members turned to hate.
In an annual Holiday E-Retail Satisfaction index by analytics firm Foresee, Netflix practically fell off the customer satisfaction cliff.
Despite a rough 2011, its stock has rebounded and is up 76 percent so far in 2012, and for the most part, it was able to hang onto its more than 23 million members by the end of 2011. The great exodus threatened by the masses never came to pass, but the company did suffer a significant defection of its DVD subscribers.
Some of Netflix's 2.8 million customers who dropped the DVD plan probably jumped ship to Redbox, which enjoyed an increase of 40 percent revenue in the fourth quarter of 2011 ($446 million). Conveniently, Redbox is now entering into a joint venture with Verizon to pack a one-two combo of streaming and DVDs for customers.