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Netflix Apologizes For Misleading Media

Sep 23, 2010 (10:09 AM EDT)

Read the Original Article at http://www.informationweek.com/news/showArticle.jhtml?articleID=227500562


Netflix has apologized for telling hired extras pretending to be average people at its splashy Wednesday launch in Toronto to "look really excited" when talking to the media.

The Globe and Daily Mail reported on the apparent deception Thursday, publishing the instructions given to extras at the debut of Netflix's online video service in Canada. The event involved the closing of a Toronto street on which extras were encouraged to "play types, for example, mothers, film buffs, tech geeks, couch potatoes, etc."

"Extras are to behave as members of the public, out and about enjoying their day-to-day life, who happen upon a street event for Netflix and stop by to check it out," read the instructions published by the Canadian newspaper. "Extras are to look really excited, particularly if asked by media to do any interviews about the prospect of Netflix in Canada."

The disclosure led to an apology by Netflix. The movie subscription service said the extras were hired for a corporate video that was being shot as part of the launch and were given the "improper direction to talk with the news media."

"Simply put: we blew it," Steve Swasey, vice president of corporate communications, said on the company's blog. "We didn't intend to mislead the media or the public, and we can understand why some have raised questions."

The launch marked the first time Netflix offered its service for receiving movies and TV shows over the Internet outside of the United States. Canadians can get unlimited access to Netflix's library for $7.99 a month, which is a dollar less than in the United States.

Netflix, which has 15 million subscribers, built its business primarily through delivering DVDs by mail, but sees online delivery as the future. Its success has contributed to a dramatic change in the way people get their movie DVDs.

As a result, companies that built stores to rent DVDs have struggled in recent years. Debt-laden Blockbuster, for example, said Thursday that it has filed for Chapter 11 bankruptcy protection and is reviewing plans to significantly reduce the number of stores it operates in the U.S. The company has 3,000 stores.

Netflix is not alone in streaming movies and TV shows. Competitors include Hulu, which recently launched, a premium Hulu Plus subscription service, and Home Box Office's HBO Go.

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