Netflix's Chief Executive Officer Reed Hastings
Netflix reported lower earnings for the fourth quarter of 2011 compared to 2010, but the earnings still beat analyst estimates. Its shares are up 77 percent since the beginning of the year. Reuters

Netflix has abandoned plans for its Qwikster DVD service even before launch, marking yet another zigzag in its complex and unpopular strategy.

The move by Netflix seemed to be welcomed by investors. Shares of the Los Gatos, Calif.-based media company rose 6.5 percent in early trading to $125.86. That's still nearly 60 percent below their 52-week high.

The move comes only weeks after CEO Reed Hastings, smarting from a 60 percent hike in subscriber fees, announced he would split the popular DVD and streaming media company in half.

Traditional DVD rentals were to be called Qwikster and get a new Web site while Netflix's remaining streaming media offerings would remain under the old moniker.

It is clear for many of our members two Web sites would make things more difficult, Hastings posted on a blog overnight. So we are going to keep Netflix as one place to go for streaming and DVDs.

The move comes as competition for streaming media heats up. Netflix, which faces losing the popular Starz movies from Liberty Media next quarter, will see more rivalry from online services including Apple, Amazon's Prime offering and other venues.

Since the Sept. 18 Netflix split was announced, CFO David Wells told a financial conference last month, We've ruffled a lot of feathers.

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