Netflix Announces Decision to End Long-Running Feature

After 25 years, the days of waiting for a red envelope in the mail are coming to a close. Netflix announced in a Tuesday blog post that it is ending its DVD rental sales. The company, which got its start in delivering discs before surpassing its competitors by transitioning to streaming, will ship its last red DVD envelopes on Sept. 29.

“After an incredible 25-year run, we’ve decided to wind down DVD.com later this year,” Netflix’s co-executive, Ted Sarandos, said in the blog post. “Our goal has always been to provide the best service for our members but as the business continues to shrink that’s going to become increasingly difficult. So we want to go out on a high, and will be shipping our final discs on September 29, 2023.”

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When Netflix launched in 1997, it only offered DVD rentals, a service that replaced the outmoded DVD rental experience by delivering DVDs straight to customers’ doors. Customers could then mail the DVDs of films and TV series back. In the blog post, Sarandos reflected on the service’s legacy, writing, “Those iconic red envelopes changed the way people watched shows and movies at home – and they paved the way for the shift to streaming. From the beginning, our members loved the choice and control that direct-to-consumer entertainment offered: the wide variety of the titles and the ability to binge watch entire series. DVDs also led to our first foray into original programming – with Red Envelope Entertainment titles including Sherrybaby and Zach Galifianakis Live at the Purple Onion.”

The move to end its legacy DVD-by-mail business comes as Netflix continues to focus on streaming. The company ended 2022 with nearly 231 million worldwide streaming subscribers. It is unclear just how many people were still subscribed to the DVD service, with the company having halted disclosing how many people still pay for DVD-by-mail delivery years ago. However, the service reportedly generated $145.7 million in revenue last year, which was down from $183 million in revenue in 2021 and $239 million in 2020, per The Hollywood Reporter.

“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 achieved and excited to continue pleasing entertainment fans for many more decades to come,” the Tuesday announcement continued. “To everyone who ever added a DVD to their queue or waited by the mailbox for a red envelope to arrive: thank you.”

While Netflix is ending its DVD service, its streaming business is still booming. The company currently offers four subscription plans – the recently-launched basic with ads plan ($7 per month), the basic plan ($10 per month), the standard plan ($15.50 per month), and the premium plan ($20 per month).