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Why Netflix Had To Raise Its Prices
sperlingreich writes "Last week, after movie streaming service Netflix raised its prices by 60%, the company's customers took to blogs and social networks in revolt, threatening to cancel their subscriptions. However, between the cost of mailing DVDs and paying increased licensing fees for content, a Netflix rate hike was inevitable. Is it still a great movie bargain? What alternative services are there?"
My cable company wants much more than $16/mo to get the various premium channels (HBO, Showtime, etc.). $16/mo is a good deal to be able to watch what you want, when you want.
"National Security is the chief cause of national insecurity." - Celine's First Law
I find plenty to do without going to first run movies or event renting movies.
To be brutally frank with you, much of what comes out of 'the industry' these days have very little to keep me engaged.
So, I take the money I save by not subscribing to movies and tv and engage in hobbies that keep me engaged and creative, such as these at http://www.allyn.com/
Most Respectfully Yours Mark Allyn Bellingham, Washington
It's not even the all at once, IMHO.
It's the "you're getting better value with us raising the prices and nothing additional being added" spin they tried to put on it.
This a thousand times. If they had said, "Our licensing fees are going through the roof, and this new pricing scheme will help us build an even better collection of streaming content," I would have been happy to pay a little more. Instead they told me how great it was that I was going to pay more for the same service, with no suggestion that an increase in available movies might accompany the hike.
Fuck 'em.
You can all but guarantee the studios behind the licensing wrote in something to keep them from doing just that, no way they can appear to be the bad guys.
I have had the opposite experience. Our anecdotes therefore cancel out.
Hell, when I had cable I would have given up ESPN if it saved me $0.25/month.
Simple fact; I and many like me will not pay for entertainment and watch advertising. One or the other.
Did you really think $9.99/mo for 1 DVD at a time + all the streaming content you can eat was going to last forever? Those are *startup* prices. They do that to grow the business, then they jack up the prices when they need to be profitable.
And they're never going to include new releases in the all-you-can-eat streaming at that price.
I do wish they would stop changing the streaming / not streaming status of movies, however. It's frustrating when a movie that has been out for ten years, and was streamable last week, suddenly is not streamable. Can't say I understand the reasoning behind that, other than that their licensing just makes no damn sense.
"Instead they told me how great it was that I was going to pay more"
Can you please show me where you see that in the linked page? Personally what jumps out to my eye is:
Netflix: "By offering our lowest prices ever, we hope to provide great value to our current and future DVDs by mail members."
ie This is great for the people who just want DVDs by mail.
Netflix: "Given the long life we think DVDs by mail will have, treating DVDs as a $2 add on to our unlimited streaming plan neither makes great financial sense nor satisfies people who just want DVDs."
ie Letting people who are in it for the streaming get DVDs as well for just $2 isn't generally profitable for us, and people who only want the DVDs and aren't interested in the streaming don't appreciate having to pay $2 more for a service they don't want.
Netflix: "We think $7.99 is a terrific value for our unlimited streaming plan and $7.99 a terrific value for our unlimited DVD plan."
ie They think both plans are worth the price they're charging for them. (Well duh!)
So they did say it's great... if you're either Netflix or someone who only wants DVDs. If you're not in either of those categories then they didn't say it was great for you.
Yes they're obviously trying to spin it by focusing on the people who will pay less, but they're not actually saying what you're trying to spin it as.
This Space Intentionally Left Blank
Gellenburg - I think you nailed it. What else is out there that provides the quality of signal, selection, or portability of view-able devices out there that is even remotely compatible? I'd pay triple to get access to even more content, like HBO and AMC shows, and new movies on DVD from Paramount, Universal, Dreamworks, 20th Century Fox etc.
:)
What is crazy is that the senior management of these companies can't see ---here we are SCREAMING --- LET ME PAY FOR UNLIMITED ACCESS TO http://entertainment.slashdot.org/story/11/07/21/2023219/Why-Netflix-Had-To-Raise-Its-Prices#YOUR CONTENT---HERE TAKE MY MONEY PLEASE!!!... and they would rather send me a subpoena from a RIAA lawyer. Oh the humanity!
Management is doing things right; leadership is doing the right things. - Peter F. Drucker
Please stop with this.
Any time something goes up in cost while reducing quality you get your Stockholm syndrome folks who whip out this line, parroting the company's marketing droids.
Have you noticed that the streaming titles have gone WAY down hill.
It used to be that there was a pile of new stuff every Tuesday. What was running on cable movie channels closely matched what was on Netflix streaming. Now you get dubious foreign films, 6.02x10^23 singing cowboy movies and maybe just maybe a B-F grade recent release. This month's was some Ashton Kutcher movie.. Which looks like it has already been pulled.
So they are offering more Anime, this is the only thing that has improved. Streaming is filled with affordable rights titles. Why are they affordable? almost NO ONE wants to see 90% of them.
Not to mention that it was quite a while ago that they decided to withhold DVDs through the mail until they had been on the shelves/PPV for 3 FREAKING months.
So as we watched a service we liked go into the toilet is is nice to have the "He only hits me because he loves me!" crowd crawl out of the wood work to say that the price increase for this reduction in quality "Is less than a small latte from Starbucks!".
As long as there are people who parrot the marketing droids or just sit back and take it, this will keep happening.
As the MPAA/RIAA/MAFIAA intend to kill any goose who lays golden eggs unless they get 100-150% of the eggs, it may be time for me to learn to torrent.
The next person who compares ANYTHING to the price of a latte needs to be torn into pieces and set on fire. My rate went up 60%. I don't care what your rate did. I have NEVER bought a latte. Not even really certain what a latte is. The fact that you obviously have to much leisure time on your hands and enough money to not care does NOT change the fact that this impact, like most things, rapes the lower income folks.
Empty Threats? Do you have any statistics to back that statement up?
I for one am a Netflix subscriber that used to be 5 DVD a month - when they had that plan. But I have downgraded 3 times. First when they started throttling movies and I wasn't get my DVD's in a reasonable time. Then I was at 3 a month. I dropped to 2 a month when they pulled the Blu-Ray "bait and switch" and started charging more for Blu-Rays.
Now this. So I dropped them to streaming only and I am considering canceling.
I don't think its empty threats. A lot of us have been with Netflix for a while and we have long memories. Each time the Netflix Management pulls one of these stunts, some of us cancel and some of us downgrade.
I came very close to canceling this time.
And its not about the money, its about being treated like a "customer" and not a "moran".
I think they really f'd it up this time and I think a lot of those threats of cancellation were not idle.