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POST OFFICE SEES RED OVER NETFLIX ENVELOPES
Thursday, December 6 2007
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Analysts on Wednesday downgraded Netflix's stock after an audit by the U.S. Postal Service determined that the company's return envelopes jam automatic sorters and have to be sorted by hand. The postal service indicated that it was likely to charge Netflix an additional 17 cents per envelope to process them. Netflix ships 1.6 million DVDs daily. The 17-cent surcharge would therefore cost the company almost $100 million per year. Netflix is expected to redesign its distinctive red envelopes in order to avoid the charge.
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