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Netflix Moves DVD Division to San Jose

Company officials say change will ease crowded conditions at its town headquarters on Winchester Circle.

Netflix announced today it's moving its newly created DVD division from the company’s headquarters in Los Gatos to San Jose. 

to support a plan by a local developer to build offices to possibly accommodate its growing operation in the future.

The move will ease crowded office conditions, place the new group closer to the center of Silicon Valley and enable the DVD management team to focus exclusively on continuing to build the DVD service for Netflix members, the company said in a press release. 

, expanding to 43 countries throughout Latin America and the Caribbean. With such growth and strong success of its streaming service by U.S. members, Netflix is rapidly outgrowing its headquarters at 100 Winchester Circle in Los Gatos and looks to continue to expand, company officials have said.

The company, which has more than 23.6 million subscribers, also said it will have a dedicated management team exclusively for DVDs through the mail in the United States to ensure the continued growth of that business for as long as Netflix members prefer to receive TV shows and movies on DVDs and Blu-ray discs.

 Thousands of angry customers have posted comments on the company's blog.

To many customers, the separation of the services represented a 60 percent price jump if they wanted to continue both services. 

The new San Jose DVD division will be headed by Andrew Rendich, a 12-year veteran of the company, according to company officials.

“The DVD division’s new location in San Jose will help alleviate the crowded conditions at Netflix headquarters,” said Rendich.  “Our new office will have convenient access to mass transit and will be closer to the Netflix Northern California DVD distribution center in Fremont.”

“Innovation is the cornerstone of our economy, and I’d like to thank Netflix for choosing to locate its DVD division to San Jose,” said Mayor Chuck Reed. “We look forward to partnering with Netflix to support and facilitate the growth of the DVD business in the years ahead.”

With room to expand, Netflix headquarters in Los Gatos will retain more than 800 corporate employees. Company officials have said they have more than 900 employees in Los Gatos. The company is the town's biggest sales tax contributor, depositing more than $3 million annually into its revenues.

“Netflix has been a Los Gatos success story for more than a decade,” said Los Gatos Mayor Joe Pirzynski. “We are proud to remain the hometown of Netflix global headquarters and look forward to the continued growth of this innovative company.”

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