Warner Bros. Gets Netflix To Delay Movies; You Don't Save Your Business By Pissing Off Your Customers

from the this-is-a-mistake dept

While not a huge surprise, it's worth discussing just how bad an idea it was for Warner Bros. Studios to get Netflix to delay renting DVDs of its movies for 28 days in order to offer up more streaming content. To recap, the very, very, very confused movie studios seem to think that the way to deal with increasing competition is to just add more windows to releases -- and one way to do that is to delay when you can rent a movie. In the studios' incredibly short-sighted thinking, they believe this will make more people buy DVDs -- the one area of the movie business that has been on the decline of late. At the same time, the studios have been pissed off at Netflix for routing around them and getting rights to stream movies from Starz, and as such, have been denying requests to stream more movies.

So, the compromise is getting Netflix to delay the rentals in exchange for more streaming content.

It's hard to express just how bad an idea this is for Warner Bros., and how far out of touch with their customers they must be to think this makes any sense from a business standpoint. What they are saying is that they are not going to give in to customer demand and offer them what they want, but actually make it more difficult, more annoying and more confusing for them to get what they want -- and (at the same time!) screwing up basic marketing plans as well. Now, when movies are released on DVD and the large group of people who prefers renting to buying goes online to their Netflix account to do so, they won't be able to. Four weeks later, they'll be looking for something else. And, for those who simply want to see it right away, they're now more likely to get it in an unauthorized manner.

Under what set of logic would it ever make sense to give the customer less of what they want in an era when increased competition from other sources is causing them to already wonder if they should buy your product?

Filed Under: business models, dvds, hollywood, movies, rentals, sales, streaming, windows
Companies: netflix, warner bros.


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  1. icon
    R. Miles (profile), 7 Jan 2010 @ 9:43am

    Delay. Queues to start 4 weeks later.

    When I first read this news, I couldn't help but think of TV Everywhere. "Want to stream your movie? Buy it first, but we'll give you online streaming free!"

    Idiocy, though, I certainly don't see this as being an issue. Given the queues of many Netflix members, I seriously doubt this will do any harm. As several already posted, the 4 week delay won't even be noticeable given there's much more to watch in the meantime.

    People are already used to delays. When "Mall cop" comes out on DVD in 1 month after it runs in the theaters (because it sucked) while the latest Harry Potter takes nearly a year, things like this don't seem to bother most folks.

    But, should anyone from Warner Bros. read this blog, just a candid note to you: thinking people are going to rush out and spend $25 per movie because they can't instantly stream it makes you look incredibly foolish.

    In what part of "you can't force consumers to buy" does the CEO and other executives not understand?

    By the way, you're not allowed to read (or reply to) this comment for 4 weeks unless you buy it first.

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