The folks over at Dish seem to have missed a glaringly obvious opportunity to steal market share from Netflix. On September 24th Dish Chief Executive Joe Clayton announced a new streaming service called Blockbuster Movie Pass. Like Netflix the service includes both streaming movies and DVD’s by mail. Great idea but they blundered by taking the ultra conservative step of offering it only to existing Dish subscribers for an extra $10 per month. Big Deal! Maybe they’ll get some small number of existing Dish subs that also had Netflix.
Earth to Dish: Haven’t you been following the drama over at Netflix/Qwikster? Through a series of their own missteps Netflix has alienated their customer base to the tune of 1,000,000 cancellations recently. If say half of those customers had both Netflix Instant and the DVD service that’s $9,000,000 per month of revenue looking for a new provider. Right NOW would have been the time to pounce with an offer to grab it. Had Dish rolled out the red carpet with some kind of “Welcome former Netflix Customers” campaign, and a stand alone offer they could have picked up many new customers.
True, Dish has hinted at some possibility of a future stand alone product. But timing is everything. Today there are hordes of disgruntled former Netflix people looking for an alternate. Google “Netflix Alternatives” and you’ll see the evidence.
So did Dish executives really miss the obvious? Perhaps they are more concerned about diluting the existing business model. Netflix attracted a lot of cord cutters: people looking to replace their expensive cable/satellite bill with a low cost alternative: $8 per month vs $80 per month.
This story is similar to how the music industry fought selling single tracks online. But Dish et al would be wise learn from history. What did we end up with? iTunes. Sooner or later the disinter-mediation effect of the internet has it’s way and we get al a carte. We got it in music and we’ll eventually get it in video entertainment.
Does Dish want to be the next iTunes? Or does it want to be the next Tower Records?
Photo courtesy of Cote on Flickr per Creative Commons