The Year in Netflix

Geoff Pickle, Web EditorDespite a year of questionable decisions, price changes and customer contention, Los Gatos, Calif.-based Netflix Inc. ended its fiscal year 44 percent stronger in earnings, while holding its subscriber base solid.

The movie and TV Web streaming and DVD services company (Nasdaq: NFLX) reported $231.6 million in year-end net income, compared to $160.8 million in 2010 profits, according to its latest earnings report available on its investor relations Web site.

Here’s a quick rehash of the year in Netflix:

  • In July, Netflix separated its DVD and streaming services and upped its monthly fees.
  • In September, Netflix CEO and co-founder Reed Hastings announced Qwikster, a separate company and Web site to house the DVD side of the business.
  • Less than a month later, after fan backlash hit the Web (and subscriptions faltered), Hastings said goodbye to Qwikster before it even began.

Domestic customers spoke the loudest. During the third quarter – when the pricing changes were made and Qwikster was announced – 805,000 U.S. streaming and DVD customers dropped Netflix like a bad habit.

But, perhaps due to boredom and a realization that books don’t have video capabilities, the domestic subscriber base moved back to 24.4 million in the fourth quarter, just slightly below the company’s second-quarter figure for U.S. subscribers, 24.59 million.

Netflix’s consolidated subscriber base hit its highest point during the year in the fourth quarter with 26.25 million subscribers after a slight decrease in the third quarter.

I guess it goes to show that companies can be forgiven for blunders, or perhaps these figures could be used as proof that the nation’s collective attention span is becoming shorter. But probably, it’s because Netflix offers services that few rival. Until that changes, the company likely isn’t going anywhere.

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