Netflix will close its DVD business after 25 years, and DVD.com will end in 2023.
“After an incredible 25-year run, we have decided to close DVD.com later this year,” co-CEO Ted Sarandos wrote in a memo Tuesday. “Our goal has always been to provide the best service to our members, but as business continues to decline this is going to become increasingly difficult. So we want to leave in style and will ship our last records on September 29, 2023.”
Founded by Reed Hastings and Marc Randolph in 1997, the streaming service got its start as a DVD-to-mail service. While Netflix has expanded its hugely popular streaming service, increasing both library titles and the streamer’s slate of original content, DVD.com has remained in business until Tuesday’s announcement.
“These iconic red envelopes changed the way people watched shows and movies at home — and they paved the way for the shift to streaming,” the memo continues. “From the start, our members loved the choice and control offered by direct-to-consumer entertainment: the wide variety of titles and the ability to watch entire series.”
Sarandos also noted that the DVD business gave the streamer his debut in original programming, including Red Envelope Entertainment titles “Sherrybaby” and “Zach Galifianakis Live at the Purple Onion.”
The streamer announced the news in a tweet to viewers, saying “Thank you for being part of this amazing journey, including this final season of red envelopes.”
Netflix also released a FAQs for users, which clarifies that the streamer will accept returns until October 27, 2023 with the subscriber’s last invoice in August. “After your August payment, you will continue to receive service until our last shipping day, September 29,” the FAQ says.
“We feel so privileged to have been able to share movie nights with our DVD members for so long, so proud of what our employees have accomplished, and excited to continue to please entertainment fans for many decades to come,” concludes the memo.
The move positions Redbox Entertainment as the last major DVD rental company. Redbox, through its familiar red kiosks in grocery stores and convenience stores, rents movies and video games at prices significantly lower than most on-demand platforms.
Redbox, founded in 2002 by Gregg Kaplan and sold to private equity firm Apollo Global Management in 2016 for $1.6 billion, launched a free ad-supported streaming service in December 2020.