The final red envelope.
Gather round, children, and hear the end of the tale of how an upstart managed to fell a massive rental empire. Way back when Blockbuster was still an actual thing, Netflix started their business by renting DVD’s which were sent via mail, no due dates or late fees. This was so effective, that it led to a slow, agonizing death for Blockbuster.
Anyway, you’d be forgiven for thinking that Netflix had long abandoned the DVD/Bluray by mail strategy. You would, however, be wrong, as they’d continued to keep the physical rental service going through this year. 2023, however, will be the final year for Netflix’s physical service; it will end September 29th this year, and that will be the final red envelope.
Those iconic red envelopes changed the way people watched shows and movies at home — and they paved the way for the shift to streaming. From the beginning, our members loved the choice and control that direct-to-consumer entertainment offered: the wide variety of the titles and the ability to binge watch entire series. DVDs also led to our first foray into original programming — with Red Envelope Entertainment titles including Sherrybaby and Zach Galifianakis Live at the Purple Onion.
Netflix co-CEO Ted Sarandos
The reasoning is fairly easy to follow. Earlier this year, it was noted that the rental service dropped it’s revenue by half, down to $100 Million in 2022, compared to the $200 million it made the year previous. In essence, the writing was on the wall.
Nonetheless, it’s a fairly substantial loss to users. The physical service offered more films and TV shows than the modern streaming service, some considerable number of which don’t seem to be available anywhere else. That said, they plan to go out heads held high, as the blog post by Netflix Co-CEO Ted Sarandos says in the blogpost announcing the end of the service:
After an incredible 25 year run, we’ve decided to wind down DVD.com later this year. Our goal has always been to provide the best service for our members but as the business continues to shrink that’s going to become increasingly difficult. So we want to go out on a high, and will be shipping our final discs on September 29, 2023.
Netflix co-CEO Ted Sarandos
He also left the post off with some stats. Like, for example, the first DVD they shipped was Beetlejuice, and their most popular title was The Blind Side. And yet, somehow, despite all the pain, there’s still at least one Blockbuster that will outlive this service. The wonders never cease.
Source: PC Gamer
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