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Netflix Throttling Heavy Renters
dankinit writes "Netflix has begun using a 'fairness algorithm' that slows shipments of movies to heavy users to protect profits, according to an MSNBC article. Netflix revised its terms of use in January 2005 to read, 'In determining priority for shipping and inventory allocation, we give priority to those members who receive the fewest DVDs through our service'. Since revising this policy last year, more and more users are realizing 'heavy renters are more likely to encounter shipping delays and less likely to immediately be sent their top choices' according to the article."
That's ironic.. because just today, they sent me this email:
Since you're former member of Netflix, we thought you'd like to know that Netflix now offers a greater selection of plans that start at just $9.99 a month. Come back and enjoy the improvements we've made, including our new Friends and Profiles features. With over 55,000 movies and delivery in about 1 business day, Netflix is better than ever.
I guess "screwing over people who watch a lot of movies" is one of their "improvements" that they've made.
The theory of relativity doesn't work right in Arkansas.
As long as a contract is well understood by both parties and voluntarilty entered into, it's fine.
NF have discovered they can't operate an entirely flat-rate service and have modified their behaviour accordingly.
One could argue that customers originally signed up to a contract which has been unilaterially modified; but I would expect the T&C to allow them in that circumstance to terminate their contract without prejudice.
NF can offer a certain service for a certain cost. Either you like it or you don't. No one forces you to buy. If they change what they offer (for better or for worse, although one wouldn't anticipate customers terminating contracts after a service improvement) then you can leave the contract.
It would only be ethically wrong if they could change their contract and you could *not* leave.
People who actually pay for instead of download their movies get screwed over?
piracy:1 - MPAA: -20
perpetually dwelling in the -1 pits
You apparently don't know Jesus is also an important prophet in the Islam. Learn to troll better, dumbass.
On the scale of evil companies, from 1 to 10, Netflix is a 2 and Blockbuster is an 11. Face it, they're just trying to slow down the DVD pirates and I don't see anything incredibly wrong with that. It does look damn suspicious for a guy to turn around 3-5 movies a day and honestly claim he's NOT pirating them and just shipping them back as soon as his DVD ripper is done grabbing the movie. I'm sure there's a small percentage of legitimate people out there that really do nothing else all day but watch movies from sun up to sun down and they don't have cable or satellite, but they're few and far between. If you look at more legitimate users they most likely see patterns like people holding onto DVDs for several weeks at a time until they find a chance to watch them whereas the DVD pirates are turning around 10-15 discs a week (or more).
FTFA:
Hastings said the company has no specified limit on rentals, but "`unlimited' doesn't mean you should expect to get 10,000 a month."
Well, der, no one wants 10k movies a month.
But, if Netflix had a point they didn't really want people going over, why not just advertise X movies per month, instead of unlimited? According to the articles, most people don't rent more than 11 per month. Set the limit higher than that, but at a point where they can make the profit they are aiming for with throttling.
They don't end up looking like buttholes if they are just honest about it up front.
Before I get any further, let me address your defense of NF:
It would only be ethically wrong if they could change their contract and you could *not* leave
first of all, shame on you for defending such abusive business practices. second, this is only ethical if NF sent out a notice saything something to the effect of:
Anything less than the above admission from NF in PLAIN LANGUAGE is abuse of their understanding with their clients, and no ammount of counterpoint/cabal.bs can change that fact.
another thing, from TFA:
After collecting consumer opinions about the Web's 40 largest retailers last year, Ann Arbor, Mich., research firm ForeSeeResults rated Netflix as "the cream of the crop in customer satisfaction."
so this is what passes as collecting customer feedback??? this 'foreseeresults' company is probably full of shit...just like most of the people in their profession...an evil, self-sustaining virus of a profession that only circulates bullshit and misperception.
Thank you Dave Raggett
This is such a crock of shit.
Lots of people do not have cable/satellite and prefer to watch DVDs only. Some of them for religious reasons, other economic, and others still to escape the low quality programming.
I have noticed that when I turn around Netflix DVDs the fastest, the new DVDs tend to take longer.
I'm going to look over NF's competitors now, to see if they have any deals going. F'ing NF.
Netflix still advertises as an unlimited service. They make no attempt to inform the subscriber that they are throttling them. This is at the very least a deceptive practice.
Now when you couple the throttling practice with the terms of the lawsuit settlement, the subscriber gets a bump in service level for one month theres a real problem. What prevents them from just further adjusting their shipping algorithym so there is no actual bump ??
Say what you want the problem is netflix not informing their customers about what they are actually buying.
Whenever you have an ongoing monthly subscription to something the provider has no incentive to do anything fast, or at all. Microsoft has demonstrated this, as has Blizzard, now its Netflix's turn. When I trialed a similar system in Australia I worked out that postal delays and scratched discs were like free money to the company. (Meanwhile, the selection was seriously crap.) These days I buy ex-rental DVDs from a friend at work who also owns an old-school video rental place.
I'm not a Netflix user but I know those that are. The heaviest users tend to be evangelists for the company and have an important role in growing the company via word of mouth, the most effective form of advertising.
If this gets widespread coverage I can see them having some serious problems, that would only be slightly mitigated by people who aren't heavy users joining for the preferential service they would get.
While the company isn't doing anything worse than credit card companies that cut the time required for payment for those that pay in time in an attempt to get them to miss the due date. If you don't like those kind of practices don't use the company.
A very good comparison.
;)
My experience is with the Canadian internet access industry - and mirrors (and, I believe, will predict) the netflix situation quite well.
Shaw (who provides cable internet) once advertised "unlimited" service.
Once people started signing up, they realized that they weren't willing to actually offer unlimited service.
Then they put a statement about "excessive usage" in the AUP - it wasn't defined, of course, but people still got nasty letters and the mouthbreathers who man their "excessive use" line even threatened to charge people for "excessive usage". These "excessive usage" fines were, of course, pulled completely out of their ass. No documentation could be found regarding when the limit was reached, what the overage charges were, etc, etc, but people were still threatened with, and possibly even were charged those fines. An almost magical fee, but one that would appear on your bill and would have to be paid, or your service would be disconnected and your account sent to collections.
After several nasty letters from lawyers and possibly some lawsuits, Shaw finally decided to write down the bandwidth limit in their advertising, at almost the exact same time their competitors did the same. Sounds like a couple people had a meeting.
What you can clearly see is that not only was Shaw involved in false advertising, but it continued to engage in such criminal activity far after their illegal activities were exposed. Moreover, their actions clearly were to the detriment of the person buying the services. Furthermore, collusion - whether intentional or just the other company matching policies - between Shaw and its competitors has led to an continuously decreasing level of service for the end user and shaw has suffered virtually no consequences.
In the end, netflix will face virtually no consequences (and before anyone says anything about the settlement, please, don't waste your breath. Bumping your users to the next tier for a month - and not bumping them back down at the end - is undeniably a win win situation for netflix).
Furthermore, the shady - if not outright fraudulent - actions of netflix in stating the return date of dvds*, has gone, and will go unpunished. In the end, blockbuster (ok it has) and the completion will eventually adopt a similar tos - putting in writing what it is doing - and the situation will only get worse as time goes on. Furthermore, "advanced throttling" - such as sending the dvds on time, but from a service center across the country - will become commonplace, since once something is in writing, it will be used.
And finally - and perhaps most importantly - "unlimited" will still be used in their advertising until a regulatory agency or a number of lawsuits convince them to change it - both Blockbuster and Netflix currently do on their websites - even though their ToS states that they throttle. And have no doubt, once one company changes it, the other will change their advertising within a month.
*If you're being throttled, if you send back 3 dvds - even 3 dvds in the same envelope - netflix will receive 2 a couple minutes apart and then "receive" the last one several hours later. Try it out
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While we're on the subject of "ulimited" being deceptive, let's also sue ISPs for offering "unlimited" internet access. I wanted to have 800 hours of interent access in January, but because of my ISP's "throttling", I was unable to exceed 744 hours of internet access, a far cry from the "unlimited" they advertised.
And how about downloading? My dial-up was throttled down to 28,8 which meant I couldn't download an unlimited amount of content, my so called unlimited account was throttled to force me to have a limit of less than 9 gigs of traffic per month. How is that unlimited?
It's because of stupid claims like this that you get those idiotic warning lables on products, like a bag of peanutes that says "Peanuts" still needs to have the label "Warning: May contain peanut products", or commercials that say "Professional driver in a closed course" when showing F1 racers, and the classic "Do not try this at home"
If they were to put a numeric limit, such as "3 DVDs per day, with a limit of 20 per month", you'd still have people accusing them of deceptive practice if they couldn't physically reach 20 per month because of time constraints. Must we have ads with more legalese words just so lawsuit phreaks don't run around pointing "Hey! That's not technically correct, it's deceptive advertising".
"Unlimited" means without limit, but if you give a time period of a "month", you have already limited it, therefor, it can never truely be unlimited. If you rented thousands of trucks and completely emptied out their warehouse, it still wouldn't be enough to qualify as "unlimited"
The universe is held together with duct tape and karma. What goes around, comes around, and gets stuck to your forehead.
Tell your biggest customers that they're no longer your priority.
Biggest does not mean profitable. In this case, just the opposite. Every business, if they hope to stay in business, does this in some form or another. The service levels match the profitability of the customer. It's why you have to go through several levels of phone prompts and wait listening to muzak to get tech support, while a corporation with a big $ support contract gets someone on the phone immediately.
This is the problem with any "flat fee" system. The profit is from those who use the system the least, not those who use it the most. Rent a lot of DVD's, and you're not their best customer, you're their worst.
So what everyone is complaining about is that NetFlix is giving priority to their best customers, while stepping back service to their worst customers.
I think its rather stupid on Netflix part. Those passionate users are likely passionate advocates as well. This is what happens when bean-counters run the ship.
Holy shit mods!
THIS IS NOT INSIGHTFUL!
I'd get 3 DVD's in the mail, I'd rip them to my HD for encoding and backup (to watch later), and send them out the next day. The day after I sent them Netflix would confirm that they had them and send out the next ones
YOU are exacly why Netflix is inclined to put something like this in place. You are not "backing up" these as you don't own them. Seriously mods, what are you thinking moding this insighful? I would vote with my points, but they won't matter with the sea of idoits who seem to get them.
Seriously, why is anybody surprised by this or whining? They are freaking renting you the movies, not selling. You do not own them. It is NOT legal for you to "back them up". It is NOT the same as if they were broadcast since that is "Time Shifting" or whatever, but doing so on DVD's is expressly prohibited. Netflix has stated since the beginning that they would throttle, or has everybody completely forgotten that one? If people keep abusing the system, next thing you know some Senator in Disney's pocket will start gunning for this "grievious breach of copyright law" or some such crap.
Copying Netflix movies is like bringing a doggie bag to an all-you-can-eat buffet.
Suing them for throttling is like complaining when the waitress won't clear your plates every two minutes.
In advertising, "unlimited" is still used within the context of reasonable behavior. If copying a Netflix movie were "reasonable", you would not need to ship the discs back, since they could make a new copy themselves for less than the cost of the return postage and let you keep the old one instead of bothering with DVDShrink.
Copying Netflix movies is like bringing a doggie bag to an all-you-can-eat buffet.
No, it'd be like bringing a copying machine to an all-you-can-eat buffet.
Agreed...can we hear from a subscriber that DOESN'T copy the DVDs and still got throttled? The firsthand accounts I've seen in this thread so far involve copying.
>> drained of any profits by freeloaders
yeah, those damn freeloader, actually expecting to get what they paid for. Who do they think they are.
It has been statistically shown that helmets increase the risk of head injury.
"Suing them for throttling is like complaining when the waitress won't clear your plates every two minutes."
No, its more like complaining that you can't get a new plate until 5 minutes after you've finished with the food on the previous plate.
The advertisement states "Unlimited," which should translate into "Everything we can do to make sure that you have three movies checked out to you at any one time." Having secret or public delays is not right, because that is the antithesis of "Unlimited." In otherwords, NetFlix is lying when they say "Unlimited."
The whole idea behind "three movies" was that it takes roughly three days for the old movie to get to Netflix and the new movie to get to you. You should be able to get 28-31 movies/month if you watch a movie a day. However, if you are watching that many movies, I suggest you do something else.
As for those jackasses that are ripping the movies. Why? 1) what you are doing is illegal, not just on DMCA standpoint, but also because you don't even own the media. You are renting the movie. Renting voids any right for time-shifting, media shifting, backup, or any of the other excuses you think you have. 2) If you want the movie that bad, either buy it or put it back in the Queue for when you want to watch it again. There are very few movies I have an interest in buying anymore. I just add them to my queue. If they are good enough to watch again, I return them and add them back into the end of my Queue. When they come up again, I decide if that is what I want to watch. If not, I move it back again.
Not to defend outright piracy, but I know many people (sometimes myself as well) who rent and return movies within 24 hours. It only takes a couple hours to watch a movie, and it beats the heck out of TV tripe most of the time. Some of them will watch a couple movies a night.
So for them, this "heavy usage pattern" is perfectly normal and not a sign of piracy. Having their shipments "throttled" means they aren't getting the full use of the service they signed up for. It's up to the service provider to adjust capacity and/or pricing tiers to deal with the load, not choke off paid subscriptions that actually use the service as advertised.
I do not fail; I succeed at finding out what does not work.
Judging from several comments here, it sounds like some people are expecting to get a lot MORE than what they paid for - they're expecting to get permanent copies of as many DVDs as they want, by getting the DVD, copying it, and sending it back the next day. I would call that "freeloading," as well as "illegal" and "ruining it for the rest of us."
I realize that some people are legitimately renting lots and lots of movies, but I have a feeling that if you took away all the "copiers", the problem wouldn't be so big that Netflix would have to stoop to massive throttling. Yes, they handled it in a dishonest manner, but just the fact that they're doing it isn't at all surprising if so many people are abusing the service.
Warning: Apple/Nintendo fangirl. Likes her electronics cute & cuddly. May be rabid.
Some people have a fetish for cataloging data it seems. I know people who rip movies even though they have no intention of ever watching them again, it's just a point of penis envy competition to point out they have that many binders of ripped DVDs
If you can't see the value in jet powered ants you should turn in your nerd card. - Dunbal (464142)
There are certainly people who are ripping music/movies/software for kicks, their own usage, or to share with friends/family -- but they are not part of my scene. I'm doing it because I do not support the idea of intellectual property. Period. Call me an extremist if you will, I think my ideas are less radical than most of the people demonstrating in the media for this that and the other.
I think that anything man can think of he should share with his fellow man. I should get paid for my service, and my labor, but I completely disapprove of people OWNING ideas. Millions die each year because of patents on medicine. Millions live in poverty because of their lack of access (no pun intended) to productivity enhancing machinery and software. I don't know that anyone dies because they can't hear the latest Kanye West song, but I object tot he fact that the industry deliberately surpresses musicians whose ideas are not "commercial" enough. I'm convinced that powerful media companies war against media they do not/cannot own, and this affects us because we are limited in our choices to whom the powerful media companies are willing to present to us.
And they do this because of the money involved. Only by making their products equally (in)valuable to the products that I want access too, can I be assured of access to everything. I think the system is broken, and the only way it can be repaired is to demonstrate to everyone how actually broken it is. I am doing what I can to bring down the system.
Call me a jackass all you want -- I think of myself as a citizen. This is my civil disobedience. There are others like me, and considering the damage one person can do to copyrights, with our infantile technology now -- imagine how much damage we can do to copyright in 20 years, with 100 recruits. P2P now is about gaining those recruits, but eventually, we WILL crush copyright.
We're here, we share. get used to it.
If netflix is having difficulty making profit due to a small percentage of heavy users, perhaps they should tweak their rental plans.
Just as an example:
Current Rates
New Rates
$09.99 1-at-a-time Unlimited
$14.99 2-at-a-time Unlimited
$17.99 3-at-a-time Unlimited (with current throttling algorithm)
$20.99 3-at-a-time Fast Unlimited (no delays for heavy usage)
Flat rates are easier to understand, but netflix is established now, and should give customers more options. If the plan don't fit the customer, change the plan!