Netflix’s Price Reduction is Also a Price Hike
By Harry McCracken | Tuesday, July 12, 2011 at 11:28 am
Netflix is announcing some pricing changes which are kind of confusing. The upshot seems to be this: if (like me) you want streaming access but not DVDs, you’ll continue to pay a reasonable $7.99 a month. If you want the ability to rent one DVD at a time and don’t care about streaming, you’ll now also be eligible for a $7.99 plan. But if you want streaming and DVDs–which, until recently, was the only option you had–you’ll pay more than you would have in the past.
For instance, if you want streaming plus one DVD, you’ll pay $7.99+$7.99, or $15.98–up from only $9.99. Streaming plus two DVDs is now $19.98, up from $16.99.
In explaining this, Netflix’s Jessie Becker says “With this change, we will no longer offer a plan that includes both unlimited streaming and DVDs by mail. ” I’m not sure why she phrases it that way, since my lineup of plan options shows some that sure look like they offer unlimited streaming and DVDs:
The change isn’t that streaming-plus-DVD plans don’t exist anymore: it’s that they cost much more than in the past.
Netflix plans and pricing have been in flux lately–back in November, the company introduced the $7.99 streaming-only plan and increased the cost of plans that include DVDs by $1 a month. At that time, it said that it wasn’t offering a DVD-only plan because it was focusing its efforts on making streaming better, an explanation that I couldn’t quite parse. Now it says that it’s realized that people still want DVDs, and that the $7.99 plan lets them get unlimited DVDs (but no streaming) at the lowest cost to date. But it doesn’t directly explain why it’s raising other rates. It just makes oblique references to the old pricing not making “great financial sense” and the new pricing “better reflect(ing) the costs of each.” A truly clear explanation of the changes would explicitly say that many people will pay more, and explain the rationale behind the hike.
Anyhow, Netflix is a neat company that provides a neat service. And I do admire the fact that it’s letting customers debate the news on Facebook and in the comments on the blog post--where a lot of angry people are threatening to take their business to Blockbuster.
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17 Comments For This Post
July 12th, 2011 at 10:47 am
I just don't understand at all why they would allow comments on their company blog. Their is so much hate on there right now.
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July 12th, 2011 at 11:02 am
They don't actually offer a streaming+DVD plan any more. They offer disc-only plans and streaming-only plans. You can then get both by subscribing to the streaming plan and one of the disc plans. The Netflix streaming offering is not acceptable by itself – there is simply too much content that is disc only, as my recent effort to get caught up on Breaking Bad will attest.
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July 12th, 2011 at 12:41 pm
I hadn't gotten around to cancelling the DVD part of the plan at $2. Now I will (meaning I have to "hurry" and get The MouseThat Roared quickly (not available streaming).
July 12th, 2011 at 4:55 pm
The slip totally makes sense now that they are coming after international customers. I wouldn't be surprised if they were also doing that to discourage dvd rentals against streaming, because streaming is probably more profitable and the only (or better) strategy when you think about going international.
July 13th, 2011 at 10:17 am
just cancel netflix, sign up for hulu plus and use red box – it'll save you money in the long-run.
July 14th, 2011 at 7:04 am
Why wouldn't they keep the same pricing for current customers, and only apply this new change to new customers?
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December 8th, 2011 at 3:08 pm
They don't actually offer a streaming+DVD plan any more. They offer disc-only plans and streaming-only plans. You can then get both by subscribing to the streaming plan and one of the disc plans. The Netflix streaming offering is not acceptable by itself – there is simply too much content that is disc only, as my recent effort to get caught up on Breaking Bad will attest. surety bonds from BuySurety.com
January 12th, 2012 at 5:21 am
They haved just brought out neflix in the Uk and I subscribed for there trial package. So far I have to say it is really great, beats going to the movies nad musch cheaper than renting from the video shop
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