Verizon came out yesterday or the day before with a plan that was just bound to piss off the masses. Mid-January, those paying their bill by credit or debit card would be assessed a $2.00 fee for the convenience. Customers could save 2 dollars by using an electronic check, money order or mailing in a payment where real people who get salaries and benefits would have to be hired to process the payments. Apparently the Verizon masses rejected the plan quite vociferously and as of today, Verizon announced it had listened to input from customers and would not implement the plan.
I guess Verizon Wireless (who has you locked in with their contracts) remembered none too fondly what happened to the darling of the stock market, Netflix. It restructured its pricing plan and divided into 2 branches–one streaming and one for hard copy dvd movies and blue ray. In some cases, the cost of belonging to Netflix went up by 60%. People left like rats off a sinking ship. CEO Reed Hastings took the heat but it didn’t help. In 2 month’s time Netflix lost over 800,000 customers. The stock has plunged 75%. According to Huffington Post:
Hastings has repeatedly taken the blame for mismanaging the announcement of the price increase in July and then making things worse two months later by trying to spin off Netflix’s DVD-by-mail rental service into a separate website called Qwikster. Since scrapping that idea in October, Hastings has been trying to repair some of the damage.
That will probably take a while. Netflix’s stock price has plunged 75 percent since mid-July to wipe out $12 billion in shareholder wealth. The backlash surprised and humbled Hastings, who revealed at an investor conference this month that he once thought Netflix’s stock would hit $1,000. Netflix’s stock gained $2.87 Thursday to close at $73.84, down from its July high of just under $305.
That maneuver just tells us how volatile some of the stock is to customer satisfaction. I had planned on purchasing more Verizon this week and decided to h0ld off, thinking of Netflix. Meanwhile, HBOgo, Amazon streaming which just happens to be free if you buy the Amazon Prime free shipping plan, and Best Buy all are vying for Netflix defectors. it all reminds me of that tragic error made by Coca Cola. New coke was just miserable. That CEO lost his job.
