Netflix wins points for popularity, but fails to satisfy

According to a recent Consumer Reports study cited by ABC News, the research organization found that approximately 81 percent of 15,000 people have watched a video through Netflix’s streaming service. However, consumer satisfaction with the amount of content on the streaming service was extremely lacking and put Netflix in sixth place behind other streaming services. Specifically, Vudu took the top spot for overall customer satisfaction followed by Apple’s iTunes and Amazon Instant Video premium downloads. Continued down the list, Amazon took fourth place with the Amazon Prime subscription service and Hulu Plus tied for fourth place as well. The most common issue with Netflix’s streaming service was the “limited selection of movies, especially the latest releases,” according to the respondents of the survey. 

netflix-streaming-demoHowever, the popularity of Netflix allowed for a larger sample size and may have skewed the customer satisfaction score. While over eighty percent of the respondents had used Nexflix streaming at some point, feedback obtained regarding the other streaming services came from 2 percent to 14 percent of the respondents depending on the popularity of each service.

Regarding the overall popularity of streaming video, approximately 52 percent of the respondents stated that they used a streaming video service within the last thirty days. Compared to other video mediums, 47 percent of the respondents watched a movie in a theater and 43 percent rented a physical disc like a Blu-ray or DVD in the last thirty days. 

While the satisfaction rating was low for Netflix when it comes to streaming video, the disc-by-mail rental side of the business got high marks. Netflix subscribers are satisfied with the selection of titles over other rental services as well as the experience when obtaining new titles. Redbox also got high marks for user satisfaction due to the low price and many physical locations, but failed to satisfy users on the selection of titles. Pulling up in last place, respondents gave poor scores to physical Blockbuster locations, Blockbuster’s disc-by-mail Total Access program and the Blockbuster branded blue kiosks that compete more directly with Redbox.

London 2012 Summer Olympic Games onlineBesides the results of this survey, this week has been particularly bad for Netflix. After announcing second quarter earnings on Tuesday, analyst expectations were not met and the company’s stock price tumbled by about 30 percent by the end of the week.

Regarding the slower growth of subscribers, Netflix is concerned that the Summer Olympics will reduce the amount of new subscribers trying out the streaming service. Traditionally, summer and winter months are strong for Netflix due to the lack of new programming from major television networks.

Also covered by Reuters this week, Netflix was rebutted by HBO regarding any potential partnership between the two companies. After Netflix CEO Reed Hastings mentioned that Netflix could still partner with HBO within a letter to shareholders, representatives at HBO immediately released a statement that the media company had no plans to partner with Netflix. Specifically, HBO spokesman Jeff Cusson said “We are not in discussions and have no plans to work with Netflix.” Since the HBO GO streaming video platform has been pushed out to many devices over the last twelve months, it’s unlikely that HBO would shift strategies and partner with Netflix.

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