Netflix CEO: ‘I slid into arrogance’
Netflix CEO Reed Hastings has issued an apology for the handling of a recent price hike that had Netflix subscribers in a lather and led to a number of subscriber cancellations and a drop in stock price. And he’s also announced that Netflix will split into two separate services: Netflix for streaming and “Qwikster” for DVDs by mail.
“I messed up,” Hastings says in a blog post published tonight (the complete text is at the end of this post—along with an accompanying video about the new Qwikster service). “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. That was certainly not our intent, and I offer my sincere apology.”
In the post, Hastings says he “slid into arrogance” and failed to communicate properly with customers, and he goes on to explain that the reason for the change in pricing—charging separately for DVDs by mail and for streaming (a change, he says, that would have happened regardless of any PR lapses)—is that the two delivery systems constitute very different businesses with very different operating requirements.
You know it’s bad when the CEO has to make a public apology. However, Hastings completely ignores the Showtime elephant in the room in his statement.