DVD subscription and content streaming service Netflix abandoned its plan to split its current mail-order DVD and Internet-streaming services.
Customers will now be able to use both of Netflix's services under one account and one password as of today.
Netflix CEO Reed Hastings made a statement on the plan in a recent blog post: "It is clear that for many of our members two Web sites would make things more difficult, so we are going to keep Netflix as one place to go for streaming and DVD's. This means no change: one Web site, one account, one password…in other words, no Qwikster."
Hastings also apologized to the company's customers and investors: "I slid into arrogance based on past success."
David Wells, Chief Financial Officer for Netflix, stated that the company "ruffled a lot of feathers" with its past decision. He then detailed how the company saw "a spike and then a steady response" of customer cancellations through the quarter and fewer than expected new subscribers.
The company's change of heart is said to be a result of Netflix's prior announcement to split its DVD subscription services and Internet streaming services while also increasing prices by 60 percent. In response to this previous announcement, the company's stocks plummeted and several customers chose to leave the service altogether.
By midmorning trade, Netflix shares were back up by 7 percent to $125.50. Before today's announcement, its shares had slumped 24 percent since Sept. 18.
Mike Olson, an analyst at Piper Jaffray in Minneapolis, stated that "Netflix wouldn’t have reversed course and suffered the stigma of walking away from Qwikster if they weren’t seeing a substantial uptick in their churn rate."
Netflix has sent out e-mails to its current customers about their latest decision.