It’s the end of an era.
Before Netflix popularized streaming movies over the internet, it rose to prominence with a unique business model: Sending customers DVDs through the mail. Subscribes to the old-school Netflix maintained a queue of movies they wanted to see and then Netflix mailed out the discs when they became available. When customers sent a DVD back in one of the company’s trademark red envelopes (they were so ubiquitous the company’s early original programming hailed from “Red Envelope Entertainment”), Netflix sent the next movie on their queue back.
It sounds crude (and not to mention slow) by today’s standards, but it seemed pretty cutting edge at the time. The big selling point: Unlike Blockbuster and other video stores, Netflix didn’t charge late fees; then as now, they were a subscription-based business. So you could theoretically hang on to a DVD forever, as long as you kept up with your monthly membership fees. It was a great system as long as you never ever contemplated how you had held on to The Umbrellas of Cherbourg for 18 months before watching it, which sort of meant you had essentially paid something like $60 to watch it.
Although it’s been years since Netflix was primarily known for DVDs by mail, the business endured for all these years. Netflix eventually even purchased the domain DVD.com, so anyone going there was taken directly to Netflix’s DVD business. But today the company announced today it would bring its DVD by mail business to an end later in 2023.
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Netflix says it plans to send out its final discs via mail on September 29 of this year. In a statement about the decision, Netflix co-CEO Ted Sarandos wrote “Those iconic red envelopes changed the way people watched shows and movies at home — and they paved the way for the shift to streaming.”
Netflix’s DVD business nearly vanished more than a decade ago, when in the fall of 2011 the streaming giant announced it would spin off its DVD arm as “Qwikster,” a new company. The news was met with such enormous pushback (and some fair amount of mockery over the name) that Netflix eventually changed course, and kept the DVDs in house. But that only delayed the inevitable. R.I.P. Netflix DVDs (and Qwikster). You were too beautiful and too reliant on the U.S. Postal Service for this world.
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(These numbers refer to the number of accounts that tuned in during a film’s first 28 days of release. To qualify, ann account had to watch at least two minutes of a movie.)
