Netflix nights still come wrapped in red and white envelopes

Netflix nights still come wrapped in red and white envelopes
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SANTA CRUZ, Calif. (AP) — Netflix’s innovative mail-order DVD rental service has been relegated to a relic in the streaming-video era, but there’s still a steady, if dwindling, audience of fans like Amanda Konkle who happily They pay to receive those records. in the iconic red and white envelopes.

“When you open your mailbox, it’s still something you really want instead of just bills,” said Konkle, a Savannah, Georgia, resident who has subscribed to Netflix’s DVD-by-mail service since 2005.

It’s a small treat enjoyed by Konkle and other still-dedicated DVD subscribers, but it’s unclear for how much longer. Netflix declined to comment for this story, but during a media event 2018Netflix co-founder and co-CEO Reed Hastings has suggested that the DVD-by-mail service could shut down around 2023.

When it happens, not if it happens, Netflix will shut down a service that has shipped more than 5 billion discs in the US since its inception nearly a quarter century ago. And it will echo the downfall of the thousands of Blockbuster video rental stores that closed because they couldn’t counter the threat posed by Netflix’s DVD-by-mail alternative.

The eventual demise of its DVD-by-mail service has been inevitable since Hastings decided to spin it off from a then-fledgling video streaming service in 2011. Back then, Hastings floated the idea of ​​rebranding the service as Qwikster — a mistake. idea that was so widely ridiculed that it was lampooned on “Saturday Night Live.” It eventually settled on its current, more prosaic name, The operation is now based out of a nondescript office in Fremont, California, located about 20 miles from Netflix’s swanky campus in Los Gatos, California.

Shortly before breaking away from streaming video, the DVD-by-mail service had more than 16 million subscribers, a number that has now dwindled to about 1.5 million subscribers, all in the US, according to calculations drawn from Netflix’s limited disclosures about the service in its quarterly reports. Netflix’s video streaming service now has 223 million subscribers worldwide, including 74 million in the US and Canada.

“The DVD-by-mail business has bequeathed the Netflix that everyone knows and watches today,” said Marc Randolph, Netflix Original CEO, during an interview at a coffee shop across the street from the post office in Santa Cruz, Calif.

The 110-year-old post office has become a landmark in Silicon Valley history because it’s where Randolph mailed a Patsy Cline CD to Hastings in 1997 to test whether a record could be delivered via the US Postal Service. USA without harm.

The disc arrived at Hastings’ home flawless, prompting the duo to launch a mail-order DVD rental website in 1998 that they always knew would be superseded by even more convenient technology.

“It was planned obsolescence, but our bet was that it would take longer than most people thought at the time,” Randolph said.

With the hit streaming service Netflix, it’s easy to assume that someone who still pays to receive DVDs by mail is a technophobe or someone who lives in a remote part of the US with no reliable internet access. But subscribers say they stick with the service so they can rent movies that are otherwise hard to find on streaming services.

For 35-year-old Michael Fusco, that includes the 1986 film “Power,” starring a then-young Richard Gere and Denzel Washington, and 1980’s “The Big Red One,” starring Lee Marvin. That’s one of the main reasons he’s subscribed to the DVD-by-service since 2006, when he was a freshman in college, and he has no plans to cancel now.

“I’ve had it for almost half my life, and it’s been a big part of it,” Fusco said. “When I was young, it helped me discover voices I probably wouldn’t have heard. I still have memories of watching movies and being driven crazy.”

Tabetha Neumann is among the subscribers who rediscovered the DVD service during the throes of the pandemic lockdowns in 2020 after running out of things to watch on their video streaming service. So she and her husband signed up again for the first time since they canceled in 2011. Now they like it so much they get a plan that lets them keep up to three records at a time, an option that currently costs $20 a month. (compared to $10 per month for the one drive plan).

“When we started going through all the movies we wanted to see, we realized it was cheaper than paying $5 a movie on some streaming services,” Neumann said. “Also, we’ve found a lot of old horror movies, and that genre isn’t very popular on streaming.”

Konkle, who has written a book on the Marilyn Monroe films, says he still finds movies on the DVD service, such as the 1954 film “Cattle Queen of Montana,” which features future US President Ronald Reagan. opposite Barbara Stanwyck and the 1983 French film “Sugar Cane Alley,” which helped her teach her film studies classes as an associate professor at the University of Georgia South. It’s a viewing habit she doesn’t normally share with her classes because “Most of my students don’t know what a DVD is,” Konkle, 40, said with a laugh.

But for all the attractions of the DVD service, subscribers are starting to notice signs of deterioration as the business has shrunk from bringing in more than $1 billion in annual revenue a year ago to an amount likely to drop by below $200 million in revenue this year.

Katie Cardinale, a subscriber who lives in Hopedale, Massachusetts, says she now has to wait an extra two to four days for discs to arrive in the mail because they are being shipped from a distribution center in New Jersey instead of Boston. (Netflix doesn’t disclose how many DVD distribution centers are still in operation, but there were once about 50 of them in the US.)

Konkle says more drives are now coming in with cracks or other defects and taking “forever” to replace. And almost all subscribers have noticed that the selection of DVD titles has shrunk dramatically since the service’s peak years when Netflix boasted over 100,000 different movies and TV shows on disc.

Netflix no longer discloses the size of its DVD library, but all subscribers interviewed by the AP reported that the narrowing selection is making it harder to find famous movies and popular TV series once routinely available on the service. Instead, Netflix now sorts requests for titles like the first season of the award-winning series “Ted Lasso,” a purchasable DVD release, into a “saved” queue, indicating that it may decide to stock it in the future. ., depending on demand.

Knowing the end is in sight, Randolph said he will mourn the death of the DVD service he brought to life while taking solace that his legacy will survive.

“Netflix’s DVD business was an integral part of who Netflix was and still is,” he said. “It’s embedded in the company’s DNA.”

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