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A company in the 70's sold 500 of it's restaurants (it's main source of revenue) and the "pundits" called them crazy. The stock took a hit but the CEO remained
by BrokerChange 15y ago
A company in the 70's sold 500 of it's restaurants (it's main source of revenue) and the "pundits" called them crazy. The stock took a hit but the CEO remained on course. He stuck to his guns.
30 years later, it is one of the most successful companies in its industry. You may have heard of them- Walgreens.
The CEO of Netflix is not dumb. He killed Blockbuster. He knew what he was doing when he split the company to save the future of his company.
His only mistake was not sticking to his guns.
- pyre 15y agoThat seems like a bit of confirmation bias. You're arguing that Neflix can do no wrong because: 1) They took out a large incumbent competitor, therefore it's impossible for them to make bad decisions. 2) A single company in the past made an unpopular decision that worked out well for them. I could similarly say that Apple firing Steve Jobs was the best thing that they ever did. Just look at them today!
- nuclear_eclipse 15y agoI imagine there are quite a few people who would agree with you; had Jobs stayed on at Apple, he wouldn't have learned the hard-won lessons from starting Pixar and NeXT.
- ceejayoz 15y agoYes, but the lesson learned should be "sometimes things unexpectedly wind up working out well", not "fire your CEO and you too could become the highest market cap company in the world"...
- tsunamifury 15y agoInteresting correction: George Lucas actually started Pixar, not Steve Jobs.
- BrokerChange 15y agoI think you're missing my point. Netflix taking out BlockBuster does not prove they can do no wrong, merely that Reed Hastings a perfectly capable CEO, and smarter than the media would have you believe. If you read about the history of the company, they started by SELLING DVD's. They barely made any money renting them. But, Reed Hastings made the decision to split that company because it wasn't the future. His 10,000 customers complained but he stuck to his guns. And look at them now. The largest streaming company in the world. He was placed in the same situation this past year. Stick to a business model with no future (DVD's-a dying medium), or split the company to improve negotiating terms for streaming deals(the future) and hopefully sell off "Quickster." It was a brilliant plan that poised Netflix for the next generation of digital distribution. Instead they backed down and changed direction, looking weak in the process.
- neutronicus 15y ago"Quickster" was also an absolutely terrible name. Orders of magnitude worse than "Netflix" which communicates perfectly what that company does.
- sukuriant 15y agoNetflix was not originally an internet streaming company, that came later. I'm not sure I could call Netflix a "perfect communication of what the company does", given the name came around when the internet was only used to select your next mail-received movie.