(Updated to include Netflix abandoning Qwikster and new power outages.)NEW YORK ( TheStreet) -- It looks like Netflix's ( NFLX) recent screw-ups are catching up with the company. So much so, that CEO Reed Hastings has been forced to make some desperate calls to right the wrongs made over the past several months. It's becoming increasingly clear that the company's string of announcements have put a sour taste in subscribers' mouths. The movie rental giant slashed its third-quarter domestic subscriber guidance last month, redicting 24 million U.S. subscribers in the July-September quarter, down from its July 25 guidance of 25 million subscribers. But this revised outlook came before the company's most recent blunder -- the announcement of the split-up of its DVD-by-mail and streaming business -- which has left investors wondering just how many more subscribers streamed for the exits. Still, its recent faux pas are out of character for Netflix, which has been a consistent company that has impressed both investors and subscribers alike. "Netflix only screwed up once in the first seven years I covered them (from 2004 until mid-2011) when they cut prices to compete with Blockbuster," said Wedbush analyst Michael Pachter. "They have now screwed up three times in the last couple of months (price increase, letting Starz get away, and capping streams per household). Maybe they'll right the ship, and maybe they will keep screwing up." Keeping this in mind, here's a look at Netflix's recent slip-ups.
Power Outages Streaming power outages have plagued Netflix over the past several months. Most recently, the company experienced another multi-hour streaming outage on Oct. 9 The company's tech Twitter feed, NetflixHelps, is littered with posts regarding streaming outages. Scrolling through the feed, it appears Netflix has dealt with numerous outages over the last several months. Netflix saw a streaming outage on Oct.1, Aug. 25, intermittent streaming problems on Aug. 22, and a multi-hour outage on Aug. 9. >Dropping Netflix? Here Are Your Options The company went so far as to offer a 3% credit to customers impacted by a service outage on July 17.
Starz Fallout Netflix will have less content come February 2012, after talks to renew its contract with Liberty Starz ( LSTZA) ended. Starz, which includes Walt Disney ( DIS), and up until recently, Sony ( SNE), makes up about 1,000 of Netflix's 22,000 streaming titles. While Netflix claims that Starz is only 8% of its subscriber viewing, it represents some of the most valuable content and has been credited with jump-starting the Netflix's streaming operations. >Netflix: We Don't Need New Releases Netflix already lost Sony content in June due to a dispute between Sony and Starz, which analysts say accounted for another 8% of subscriber viewing. Starz provides a large chunk of Netflix's newer content, making up half of the streaming titles from the top 50 movies in 2009 and 2010. Current Starz movies on Netflix include Toy Story 3, Secretariat, Johnny Depp's Alice in Wonderland and You Again, starring Betty White. It's difficult to come by new content these days, and even though Netflix may be saving a big chunk of change from the Starz deal, there's not many other vehicles for the company to invest the money in content. Most new content is wrapped up in exclusive deals until 2015, leaving non-exclusive content, which tends to be older movies and television shows that are readily available.