Netflix and Qwikster

In 2011 Netflix was winning. Reed Hastings saw streaming as the future and decided to push customers there fast: a roughly 60 percent price hike for anyone wanting both DVDs and streaming, then a plan to spin the DVD business into a separate brand and website called Qwikster. Customers suddenly faced two accounts, two queues, two bills. They revolted, the company shed about 800,000 subscribers in a single quarter, and the stock collapsed within months.

Here is the trap this case sets for founders and operators: Hastings was not wrong about where the market was going. So the decision it sharpens is not direction but execution speed and sequencing, and how you treat the customers funding a transition you know you have to make. There is a twist in how this story actually resolves, and a precise lesson about protecting a profitable-but-dying line. Both are worth working through inside the app rather than reading the summary.