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 DVD service, which still delivers films and TV shows in the red-and-white envelopes that once served as Netflix’s emblem, plans to mail its final discs on Sept. 29.
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 its business steadily shrank. The DVD service generated $145.7 million in revenue last year, which translated into somewhere between 1.1 million and 1.3 million subscribers, based on the average prices paid by customers.
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.
But the DVD service was once Netflix’s biggest money maker.
Shortly before Netflix broke it off from video streaming in 2011, the DVD-by-mail service boasted more than 16 million subscribers.
