it is interesting that these CEOs stay where they are. Don;t they do marketing analysis? Elasticity reports? Now that he has lost subscribers, investors, and shareholders he issues an apology.
I had netflix, sent them numberous customer survey emails about their content. Why less than half hte movies on streaming status? was not worth the money since all I do is stream and all I could watch were 2-3 year old movies.
I sent the same emails to the CEO of Pandora when they took the "free" service and sent out emails demanding $39 a week or so after their IPO. all Hype, no business plan.
Whether or not the CEO wants to understad it, you really have a "contract" between you and your subscribers which is predicated on the type of usage they have TODAY, not your projected need for cash flow. If you offer it for free, it has to be free, find another way to make revenue. If you offer the service for $9 a month, then it is $9 a month, unless you offer the user MORE FOR THE MONEY.
Just because you made the hype stick and got your IPO and fooled a bunch of stupid VCs is no reason to think that now the general subscriber is going to pick up your business ineptness and continue on.
Not only did this CEO misjudge the user and the increase he already did, he misjudged the intelligence and loyalty that he HAD before he violated that trust. This letter is just too litle too late. He opened hte door for HBO-GO, Cox on demand, Directv everywhere, etc.
Market share once lost is not simply gained with the same product. |
