The continuing customer 
backlash at Netflix is taking on staggering proportions. The company (whose stock, by the way, is down another 7 percent in trading this morning) has lost a quarter of its value in the past month.
Things don’t look to be slowing down, either – and competitors are viewing that as a golden opportunity to swoop in and steal some of those disgruntled customers.
For years, customers 
and analysts have pestered Netflix to add video games to its rental operation. In a few weeks, they’ll finally get their wish.
Netflix has announced plans to add titles for the Xbox 360, PlayStation 3 and Wii to its catalog in the coming weeks. The new options will come as part of the company’s plan to split off its DVD-by-mail service into a separate brand and website called Qwikster.
Gamasutra columnist Chris Morris 
looks at how Netflix’s recent decision to add video games to its rent-by-mail service could pose a threat to competitor GameFly and shake up the video game rental market significantly.
Maybe it’s a good thing that GameFly has been unable to get its act together and launch that IPO it filed for last February – because if it had, its stock would surely be taking a prison yard beating today.
Netflix has made some baffling moves in the last couple of months, and Sunday’s announcement that it would be spinning its DVD-by-mail service into a separate division certainly qualifies as one of them. But the addition of video games to its offerings could be just what the business needs to prop that service up for a few more years.
Netflix plans to 
separate its streaming and rental-by-mail businesses into separate divisions in the coming weeks.
The company hopes the new division, dubbed ”Qwikster,” will help it stabilize its subscriber base and revive its share prices. To help revive consumer interest, the company plans to add video games to its rental options as well.
Also in the note, CEO and co-founder Reed Hastings acknowledged the overwhelming negative feedback to recent price changes at the company, saying ”I messed up. I owe everyone an explanation.”
Netflix has lowered 
its subscriber estimates by 1 million people for the third quarter, the first sign that the consumer backlash over its drastic price changes is negatively impacting the film streaming/rental service.
In a note to investors, the company lowered the expected number of DVD-only customers from 3 million to 2.2 million, while ratcheting down the number of projected streaming customers from 10 million to 9.8 million. The number of customers using both services is expected to remain unchanged.
Looks like Dish Network 
could be looking to tackle Netflix on its own turf – and it’s bringing a surprise player to the game.
Bloomberg reports the satellite service plans to offer a standalone subscription streaming service that will capitalize on the Blockbuster brand. And, to rub salt in Netflix’s wounds: It might include titles from Starz.
There are a lot 
of ways to stream Netflix to your television these days — including, in some cases, directly through the television itself. But new data from ABI Research shows that the method of choice for most people is through game consoles.
Owners of game machines spent an average of seven to eight hours per week watching streaming video, the company found.
Amazon has been the 
perennial bridesmaid to Netflix in the streaming video space for a while now. That hasn’t changed – but the company has hit a notable landmark.
The online retailer’s Instant Video service now has 100,000 movies and TV shows in its library of streaming and downloadable content.
GameFly has found a fair bit 
of success by emulating Netflix’s old business model in the video game space. For a fixed amount per month, users can rent console games and keep them for as long as they want.
Now, the company is following in its forerunner’s footsteps once again – with plans to add a game streaming site to supplement its offerings.
There’s plenty of talk 
about cord cutting these days – the idea that people can cancel their cable subscriptions and still view most (or all) of their favorite programming. There’s not a lot of talk, though, on where it’s taking place.
The answer, it seems, is Dallas, Texas.
Chris Morris: Journalist 