Greg Sandoval from CNET took a look back at the Qwikster & price hike debacle that happened a year ago (time really flies, doesn't it?). Sandoval spoke with current and former employees to get a better understanding as to what went wrong.
Once the decision to spin of the DVD business as DVD Co. (eventually Qwikster) in March was made, Hastings started separating the businesses immediately:
Some employees were stunned by how quickly and unemotionally DVD operations, the backbone of the business for a decade, was split off from the company. DVD Co. was moved out of Netflix's offices to a space a few blocks away. Netflix's leaders stopped discussing DVDs. Those Netflix executives who moved to DVD Co. stopped attending Netflix management meetings. Some of those people included Allison Hopkins, Netflix's vice president of human resources, Liz Coddington, vice president of financial planning and John Robison, vice president of DVD product development.
Few people who had worked for Netflix for any length of time were surprised that there wasn't more discussion about the plan. As Netflix's business blossomed and as he was personally applauded in the press, Hastings had grown much more confident in his own decision making, less receptive to taking advice from his senior management team. What's more, few of the people who could persuade Hastings or tell him he was making a mistake were around anymore.
Sandoval's sources suggest that Netflix CFO Barry McCarthy left over a salary dispute with Hastings (he was unhappy about a raise given to CCO Ted Sarandos):
McCarthy was livid, said the sources, and he went to Hastings to discuss his salary. The two men worked on finding a compromise but the damage was done. McCarthy handed in his resignation and within two days Hastings replaced him with David Wells, Netflix's vice president of financial planning and analysis. The same day McCarthy cleared out.
If you want to get a better understanding of what happened and what it's like to work at Netflix, you should read the entire article.