Netflix ended March with 232.5 million worldwide subscribers to its video streaming service, but it stopped disclosing how many people still pay for DVD-by-mail delivery years ago as that part of i…
SAN FRANCISCO — Netflix is poised to shut down the DVD-by-mail rental service that set the stage for its trailblazing video streaming service, ending an era that began a quarter century ago when delivering discs through the mail was considered a revolutionary concept.
The growth of Netflix’s video streaming service has been slowing down over the past year, prompting management to put more emphasis on boosting profits. That focus may have also contributed to the decision to close an operation that was becoming a financial drain.Shortly before Netflix broke it off from video streaming in 2011, the DVD-by-mail service boasted more than 16 million subscribers.
The service’s history dates back to 1997 when Netflix co-founder Marc Randolph went to a post office in Santa Cruz, California, to mail a Patsy Cline compact disc to his friend and fellow co-founder Reed Hasting. Randolph, Netflix’s original CEO, wanted to test whether a disc could be delivered through the U.S. Postal Service without being damaged, hoping eventually to do the same thing with the still-new format that became the DVD.
With just a little over five months of life remaining, the DVD service has shipped more than 5 billion discs across the U.S. — the only country in which it ever operated. Its ending echoes the downfall of the thousands of Blockbuster video rental stores that closed because they couldn’t counter the threat posed by Netflix’s DVD-by-mail alternative.
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