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Entries in Netflix (26)

Wednesday
Dec262012

Netflix Users Hit with Streaming Outage on Christmas Eve

Netflix(NEW YORK) -- Several Netflix users who were looking to stream their favorite holiday movies online on Christmas Eve were out of luck.

The company experienced a blackout that knocked out its streaming video service to many of its customers.

In a tweet Monday, Netflix said: "We're sorry for the Christmas Eve outage. Terrible timing! Engineers are working on it now. Stay tuned to @Netflixhelps for updates."

The outage lasted over 10 hours and wasn't fully resovlved until Christmas Day.

"Special thanks to our awesome members for being patient. We're back to normal streaming levels. We hope everyone has a great holiday," Netflix tweeted on Tuesday.

The company blamed Amazon, its Web service provider, for the issue.

Copyright 2012 ABC News Radio

Friday
Jul272012

Netflix Most-Used, Least-Liked Streaming Service

Netflix(NEW YORK) -- Netflix is by far the biggest video streaming service, but users like it the least of all the services covered in Consumer Reports survey out today.

Just over 8 in 10 in the CR survey who used a streaming service the previous month subscribed to Netfilx, but  rival services Vudu, Apple iTunes, and Amazon Instant Video all scored higher in overall satisfaction in the consumer group’s first ratings of video services.

“Our survey revealed that a healthy selection of titles is one of the biggest factors in overall satisfaction with video services, which is why disc rental services and pay-per-view streaming services scored the highest in our Ratings,” Jim Willcox, senior electronics editor, Consumer Reports, said in a statement.

“Streaming video content directly from the Internet is emerging as the preferred choice for video viewing,” according to the magazine. “Fifty-two percent of the 15,277 ConsumerReports.org subscribers polled said they used a streaming video service in the previous month, compared to 47 percent who saw a movie at a theater, 43 percent who rented a DVD or Blu-ray disc, and 32 percent who used their cable provider’s video-on-demand service.”

Netflix users griped about its limited selection of movies, especially new ones. Fewer than one in five survey respondents said that they were highly satisfied with the unlimited-use services’ choices of titles including those who rated Amazon Prime and Hulu Plus.  Pay-per-view streaming services including Amazon Instant Video, iTunes, and Vudu did get high marks from more than 60 percent of users, the group said.

“Netflix’s disc-by-mail service and independent video stores were judged to have a more satisfying selection of titles, including current ones, than even the best streaming services. Redbox kiosks were neck-and-neck with Netflix and independent stores in overall satisfaction, but fell short on selection. Survey respondents were not as impressed with Blockbuster stores, Blockbuster Express kiosks or Blockbuster Total Access disc-by-mail,” according to CR.

The full report is available online at ConsumerReports.org.

Copyright 2012 ABC News Radio

Monday
Jul022012

Storm Blamed for Instagram, Netflix, and Foursquare Outages

THOMAS COEX/AFP/Getty Images(NEW YORK) -- If you had some trouble over the weekend uploading a photo to Instagram, checking in on Foursquare, watching a movie on Netflix, pinning something to your Pinterest board, or posting to Reddit, you’re not alone.

Amazon’s Web Services, which powers many sites and Cloud services, was taken out by the same lighting storms that caused power outages across the country. Amazon’s main server facility in Northern Virginia was hit hard by the storm, which left over 3 million people on the East Coast without power.

The outages started around 9 p.m. ET on Friday and lasted close to 12 hours for some of the services. Instagram and Netflix informed users via Twitter, however, many still were looking for answers. Instagram became one of the highest searched terms on Google on Saturday. Most services were up and running by Saturday afternoon.

This is the second time Amazon’s Web Services went down this month.

Copyright 2012 ABC News Radio

Thursday
Jan262012

Netflix Stock is Hot as New Customers Stream Movies

Justin Sullivan/Getty Images(NEW YORK) -- All of a sudden, Netflix (NFLX on the Nasdaq) is a hot stock again, with the company reporting it now has won over almost as many customers as it lost in 2011 when it jacked up its prices and tried to make a rocky transition from DVD movies to streamed video on demand.

Netflix stock climbed more than 20 percent Thursday from Wednesday's close. After the bell the company reported it made $40.7 million, or 73 cents per share, in the final three months of last year. That's down from the year before -- but much better than the 54 cents per share that analysts polled by FactSet had forecast.

The bigger question may be whether Netflix is successfully moving from one technology to another -- a transition at which few companies excel. Apple has successfully moved from personal computers to iPhones and iPads, but it's a notable exception to the general pattern. Kodak, which all but invented digital cameras, famously stumbled as it tried to move on from film to digital.

"Yes, they are managing the transition," said Edward Williams of BMO Capital Markets. "They're taking the right steps to move there."

But for now, Williams said Netflix may just be a so-called momentum stock that lost its appeal and is regaining it. From July to December 2011 it dropped from $300 per share to $67. On Thursday it was back around $120.

Last fall, Netflix conceded that more than 800,000 customers had quit as it tried to get them to stream video instead of ordering DVDs sent through the mail. Now, it says, at least 600,000 people have either rejoined or signed up for the first time -- and fewer of them are waiting for those famous red Netflix envelopes.

"The global opportunity for streaming TV shows and movies becomes more compelling every year with the rise of smart TVs and faster broadband," said Hastings and Chief Financial Officer David Wells in the company's letter to shareholders. "With our streaming growth, Netflix is leading the development of Internet TV."

Rob Enderle, a California-based technology consultant, was less charitable: "They nearly killed the firm, and had there been stronger competitive alternatives, they likely would have," he said in an email. "They did something incredibly stupid and got lucky this time. I wouldn't bet on that happening again."

Williams said Netflix has competition from online video offered by Amazon and Hulu, and cable TV companies could be an even bigger threat. But he said Netflix had to move away from DVDs by mail. "The DVD business is ultimately going to go away," he said. "I don't think it's imminent...but it will be in a perpetual state of decline."

Copyright 2012 ABC News Radio

Friday
Dec302011

ABC News Lists Top 10 Business Blunders of 2011

Jin Lee/Bloomberg via Getty Images(NEW YORK) -- Businesses make mistakes all the time. Unfortunately, when they blunder, the repercussions can be wide, from customer data being compromised to employees losing their jobs and shareholders getting wiped out.

Here's a look at 10 foul-ups of 2011:

1. Bank of America: The $5 Fiasco

When Bank of America announced plans in late September to charge customers for using their debit card for purchases, customers expressed their outrage in dramatic fashion.

Over 150,000 people signed a petition asking the bank to cancel the $5 monthly fee and over 650,000 people joined Bank Transfer Day, shifting funds to credit unions.

The bank, still reeling from the mortgage meltdown, relented and announced on Nov. 1 the fee's cancellation.

2. Netflix: Red Envelope Company Sees Red

DVD-rental company Netflix lost 800,000 of its 20 million members after it announced a new pricing plan and streaming service, Qwikster, in October. CEO Reed Hastings soon after canceled plans to split the service and apologized to customers, but the damage was done. Netflix's stock price, which was near $300 a share in mid-July and has a 52-week high of $304.79, recently traded at $70.

3. Family Radio: Doomsday Averted, But Not for Radio Station

Companies frequently miss forecasts but when Harold Camping, president of radio station Family Radio, predicted the end of the world twice this year, some may have breathed a sigh of relief.

Camping first predicted the end of the world for May 21, 2011 investing heavily with millions of dollars in a national advertising campaign. After the world pressed on, Camping then changed his forecast to Oct. 21. Camping reportedly apologized for his failed predictions.

"I should not have said that, and I apologize," Camping said, according to San Francisco's KGO-TV. "God is merciful."

4. RIM's Blackberry: Worldwide Outage

Outages for Canadian company Research in Motion's (RIM) Blackberry mobile device caused a stir after service in North America, Europe, the Middle East, Africa and parts of Asia was knocked out Oct. 12.

David Yach, chief technology officer for software, said the problem originated in Europe and spread because there was a massive backlog of emails. CEO Mike Lazaridis apologized in a Youtube video.

The company's shares fell more than 75 percent in 2011, with growing domination from smartphones with Google's Android software and the iPhone. The Wall Street Journal called 2011 a "disastrous" year for RIM and investors and analysts have called for the board to take stronger control of the company.

5. Goldman Sachs: Occupy Losses

In October, venerated investment bank Goldman Sachs reported its second loss since its IPO in May 1999, missing estimates for the second consecutive quarter. The company reported a loss of $393 million in the third quarter compared with a $1.9 billion profit one year ago. Worries in both debt and equity markets caused softness in the bank's revenue, according to Janney Capital Markets.

Goldman Sachs and other large banks attracted the ire of the Occupy Wall Street movement, which launched on Sept. 17, for their role in risky bets in the subprime mortgage market that contributed to the country's near financial collapse.

6. Sony PlayStation: The Year of the Hack?

In April, Sony Corp. said the credit card data of PlayStation users may have been stolen in a hack that forced it to shut down its PlayStation Network for a week, disconnecting around 77 million user accounts around the world.

The company said there was no evidence that credit card information was compromised, but said it could not rule out that possibility, leading PlayStation users -- and their parents -- to take precautions with their data.

Several other companies confessed to data breaches, such as investment bank Morgan Stanley and online marketing firm Epsilon.

7. Borders: Bankruptcy, Liquidation

After bookseller Borders filed for chapter 11 bankruptcy in February, the chain began liquidating bookstores and closed over 500 bookstores in the U.S. and Puerto Rico that it owned at the beginning of the year. Borders Group, based in Ann Arbor, Mich., announced 6,000 layoffs February 17 and 10,700 layoffs July 19.

8. American Airlines: Friendly Skies of Bankruptcy

American Airlines' parent company, AMR, filed for Chapter 11 bankruptcy on Nov. 29, faced with rising fuel prices and high labor costs. While operations continued for customers, the airline said its employees would be the most affected.

The company, based in Fort Worth, Texas, was the only major U.S. airline that did not seek bankruptcy protection after the 2001 terrorist attacks. Unlike other carriers, American did not merge with a competitor, and it was the only major airline to lose money last year.

CEO Gerard Arpey stepped down and was replaced by Thomas Horton, formerly the company's president, to run the nation's third-largest airline. AMR shares plunged 85 percent to just 25 cents a share in trading that day. Thursday the New York Stock Exchange announced that the company's shares would be delisted.

9. U.S. Postal Service: Shuttering Post Offices

The U.S. Postal Service had a dramatic last few years as post offices have closed in rural towns, and in 2011 the organization was near a default and faced a $9 billion deficit.

With the prevalence of e-mail and delivery competitors FedEx and UPS, the future of the postal service is very much in doubt.

On Sep. 15, the Postal Service announced it would begin studying 252 out of 487 mail processing facilities for possible closure but it has not yet confirmed closures of those facilities.

The Postal Service announced on Dec. 5 that it wants to cut an estimated $3 billion in costs to avoid a bankruptcy. The proposal includes the elimination of one-day delivery and closing half of its processing centers.

10. MF Global

The bankruptcy of the commodities trading firm MF Global on Oct. 31 was the eighth largest in U.S. history. About $1.2 billion in client money went missing as the company shut its doors. Jon Corzine, former senator and governor of New Jersey who resigned as CEO on Nov. 3, said he does not know where the money is.

After making risky bets on the European debt crisis, the company's bankruptcy has "devastated thousands of customers -- including farmers, ranchers, grain elevators, small business owners and others," said Sen. Debbie Stabenow, D-Mich. A Senate hearing about the missing money took place on Dec. 13, describing outrage from lawmakers and clients.

Copyright 2011 ABC News Radio

Friday
Oct282011

After Netflix Hikes, Red Box Wants More Green

Netflix Inc.(NEW YORK) -- Netflix managed to anger many customers -- and gut its stock price -- with changes in its price structure for renting and streaming DVDs. The company recently lost 800,000 U.S. subscribers, some of whom opted to switch to Netflix competitor, Red Box.  

But now Coinstar, Red Box’s owner, is risking its own customer backlash by doing the same thing and raising its prices.

Red Box is hiking its daily DVD rental fees up twenty percent, from $1 to $1.20.  Red Box prices will remained unchanged for Blu-ray discs at $1.50 per day and video games at $2 per day.

Although this price hike is not as drastic as Netflix’s 60% increase, it still scared investors, and Coinstar’s shares plunged ten percent in Thursday’s trading.

Copyright 2011 ABC News Radio

Tuesday
Oct252011

Netflix Stock Plunges after 800,000 Members Quit

Justin Sullivan/Getty Images(NEW YORK) -- If you were angry enough at Netflix to cancel your membership over major changes to the movie delivery service, you weren't alone: there were 810,000 people just like you, the company announced Tuesday.

The news sent the one-time Wall Street darling into another tailspin Tuesday as the stock -- already down 60 percent since the company announced a price hike in July -- dropped another 35 percent after the opening bell. Netflix stock briefly hit $300 per share on July 13; Tuesday it dropped below $75.

All of the red arrows for the company known for its red envelopes stemmed from a doubly disastrous decision. Netflix had a successful movies-by-mail service, but decided it would be left behind if it kept sending DVDs to people instead of streaming them online. When the company tried to jack up its prices -- and spin off its mail service to a new business called Qwikster -- customers revolted.

"They're making a transition from a 'momentum stock,' where you can do no wrong," said Vasily Karasyov, an analyst at Susquehanna Financial. "When the momentum's gone, you see the complete annihilation of the share value. That's why they call it a momentum stock."

Netflix actually beat Wall Street estimates when it reported profits Monday, but it warned that it would lose money in 2012. It needs to clean up the mess in the U.S., and it's trying to expand its service in the U.K.

"We moved too quickly," CEO Reed Hastings told ABC News last month. "We didn't give it enough thought. We didn't give it enough explanation, enough integration, and you know, that's legitimately caused our customers to be angry."

Karasyov is among several analysts who have downgraded Netflix stock to "negative" from "neutral."

"There is no quick fix," he said. "It there were a quick fix, don't you think they would have done it by now?"

Copyright 2011 ABC News Radio

Tuesday
Oct252011

Netflix Loses 800,000 Subscribers over Price, Rental Changes

PRNewsFoto/Netflix, Inc.(LOS GATOS, Calif.) -- Netflix is paying for its recent missteps and loss of goodwill.

The Internet movie rental provider announced Monday that the number of its subscribers dropped to 23.79 million last quarter -- a plunge of 800,000 from the 24.59 million users in the second quarter.

The subscription drop came as Netflix announced it was raising its prices by as much as 60 percent and dividing its DVD-by-mail and online streaming services, causing an outcry among users, who cancelled their memberships in protest.  The company has since nixed its plan to separate its rental businesses.

Monday's third quarter report also rocked the company on Wall Street, sending its shares down 27 percent as trading wrapped up for the day.

Copyright 2011 ABC News Radio

Monday
Oct102011

Netflix Retracts Plan to Separate DVD, Streaming Services

PRNewsFoto/Netflix, Inc.(LOS GATOS, Calif.) -- Nearly a month after Netflix announced it was going to spin off its DVD rental business into another website, the company has now retracted its plan to separate the service.

In a statement released Monday, the Internet movie rental provider said it would keep its DVD-by-mail and online streaming services together on Netflix.com.

The company will no longer be branching out its DVD business under the name "Qwikster," as it had announced on Sept. 18.  That plan would have forced Netflix customers to have two distinct accounts and sign into two separate websites -- Netflix.com and Qwikster.com -- in order to manage their rental requests.

Netflix co-founder and CEO Reed Hastings said he axed Qwikster to keep renting simple for customers -- and after user outcry over the switch that sent the company's stock tumbling.

"It is clear that for many of our members two websites would make things more difficult, so we are going to keep Netflix as one place to go for streaming and DVDs," Hastings wrote in a blog post Monday.  "This means no change: one website, one account, one password...in other words, no Qwikster."

Copyright 2011 ABC News Radio

Monday
Sep262011

Netflix CEO: Company Has 'Sincere Regret' over Handling of Service Changes

PRNewsFoto/Netflix, Inc.(LOS GATOS, Calif.) -- Netflix "moved too quickly" in making changes to its subscription plans, which caused widespread outrage among its customer base, Netflix CEO Reed Hastings said in an exclusive interview with Nightline.

"We moved too quickly," Hastings told ABC News' John Donvan. "We didn't give it enough thought. We didn't give it enough explanation, enough integration, and you know, that's legitimately caused our customers to be angry."

The company caught vicious backlash from subscribers after Netflix announced last week it was separating its DVDs-by-mail and live streaming services. The announcement came after Netflix had said in July it also would be raising its subscription costs by as much as 60 percent, starting Sept. 1.

"We made a big mistake in the way we communicated it," Hastings said. "We're apologizing, and we're trying to build this great service for [our customers]."

Since the announcements, more than 600,000 customers have canceled their subscriptions.

"It's a big setback, there's no question about that," Hastings said.

Netflix's blog and Facebook page became inundated with negative comments and Netflix's stocks plummeted 50 percent.

"It's reading some of those comments that made me realize that I really did regret the way that we handled that communication," Hastings said.

In response, Hastings, who was named Forbes' "2010 Business Person of the Year," sent an apology email to Netflix's 24 million customers, starting the letter with, "I messed up. I owe you an explanation."

Hastings also announced last week that the company's DVDs-by-mail service would now be called "Qwikster" and Netflix would be just for streaming.

"It's not a marketing tactic, OK?" Hastings said of the letter. "It's an expression of our genuine, sincere regret about the way we handled the communication with people. We've worked really hard to serve and built a lot of trust and loyalty, and we didn't respect that in the way that we wish we had."

But another hiccup surfaced: Netflix didn't secure the @Qwikster Twitter handle rights before Hasting made his announcement. It is currently used by a man named Jason Castillo.

"I think we were just moving too fast," Hastings said. "Sometimes, the thing that makes you great, your speed, can trip you up, and so, you know, we need to be a little bit more thoughtful as we move."

Hastings told Donvan that while his company didn't communicate the changes with its customers well, the decision to split the company in two was the "right move internally."

"There's no question," Hastings said. "In terms of customers, what we should have found is more ways to make it transparent to the customer, so it was less of a change.

Established in 1997, Netflix launched its DVDs-by-mail-only service in 1999, then incorporated the live-streaming service last year. When Hastings spoke with Nightline in 2009, even then he said he knew that streaming would become a huge priority.

"Eventually in the very long term, it's unlikely that we'll be on plastic media. So, we've always known that," he said at the time. "That's why we named the company Netflix and not DVDs by Mail."

And that hasn't been the end of Netflix's worries: Other heavyweight media companies have used Netflix's recent mishaps as a springboard to launch their video-streaming ventures.

Amazon.com Inc., which launched a free on-demand video service to its Prime shipping members in February, signed a deal with Twentieth Century Fox Monday to stream Fox movies and TV shows, including the popular shows 24 and Arrested Development. The company already has a deal with CBS Corp. to stream 2,000 TV show episodes to its Prime members.

Even Blockbuster, which Netflix forced into bankruptcy court and was bought out by TV provider Dish Network for $234 million earlier this year, is getting back into the game. Blockbuster announced a new DVDs-by-mail and Internet video streaming bundle for $10 a month -- roughly what Netflix used to charge users before it raised its prices.

Not to mention Netflix has been competing with the likes of Apple Inc., Google Inc. and Hulu.com.

Despite it all, Netflix continues marching on. The company signed a multi-year licensing deal with Dreamworks Monday to stream its movies, including Shrek and Kung Fu Panda, and TV specials, starting in 2013.

Copyright 2011 ABC News Radio







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