Netflix Purchase of DVD.com: Solution or Problem?
Netflix (NASDAQ:NFLX) is no stranger to changing business models on a whim. The company has confirmed its purchase of DVD.com on Friday in what seems to be an attempt to revive the DVD business. Financial terms of the purchase were not disclosed.
Netflix has said that it has acquired DVD.com as part of an effort to separate its DVD business from its streaming operation. The acquisition indicates that Netflix just might regret its previous decision to kill Qwikster.
Qwikster allowed Netflix to focus on streaming content and drift from DVD sales. However, the Qwikster experiment generated a lot of unhappy customers, causing Netflix to do away with its marketing move.
It is uncertain that a revival of Netflix’s DVD business will generate much needed sales for the company. It seems that Netflix is retracing its steps by investing in old technology. Netflix’s solution just might be another problem.
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