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Netflix To Lose 1 Million Subscribers
tekgoblin writes "In light of the recent price increase at Netflix, it made quite a few subscribers mad. Netflix expects to lose around 1 million total subscribers in the short term after the price changes (which split off separate subscription plans for streaming video and DVD rentals). On top of the price increase, Netflix will lose their contract with Starz in February, which will cost them around 1,000 total streaming titles from their collection."
Please no! This can't be true!!!
Netflix loses a million subscribers?!
No! My world is at an end!!!
Well really, what the heck did they expect? The e-mail they sent out about splitting up the streaming and dvd mailing services was ridiculously patronizing.
I mean, I would have been a lot more okay with things if they'd just been straightforward and said "look, the people we get our content from are raising the prices on us, we need to charge you more to cover it". That's fine, that I can understand.
Instead, those assholes decided to pitch it as some sort of super awesome deal, where instead of being forced to pay for streaming and dvd mailing together, you're now paying for them separately! It's great! So much better than the old deal! And you, the consumer, are such an idiot that you're not even going to notice that the price of your plan increased significantly, doubling in some cases! (if you're like me and you were on the 1 dvd + streaming plan).
Do they not have any sort of market demographics at all? Do they have no idea the kinds of people that subscribe to their service? We're more likely to be early adopters, for goodness' sakes; we're not going to appreciate being talked down to like we're children who can't do math.
And look, I do appreciate Netflix - as convenient as Redbox is, it doesn't quite have the selection. It's just, reading that goddamn e-mail about the new plans left such a bad taste in my mouth I couldn't stand giving them money any more.
Haha, no they wouldn't. A good portion of Linux users would bitch about how the client isn't completely open source. Netflix may get a couple thousand extra subscribers if they made a linux client but nowhere near enough to cover the 1 million they are estimated to lose due to the price increase.
It's tough to be the middleman... Netflix stands between the consumers and the content providers, but streaming video is rapidly becoming a commodity, so no doubt the content providers will get greedy and decide they want to own the whole thing end to end. I'm sure they'll ignore the amazing feat Netflix has accomplished (namely getting people to pay for streaming content online) and attempt to set up their own sites with onerous terms (pay-per-view with 24 hours to start) and high monthly rates, then be all surprised when no one signs up and start claiming piracy is destroying their business.
If they lose customers, but get more money per customer, it can work to Netflix's advantage big time. Their costs are mostly on bandwidth, and if they lose 1 million customers, that's 1 million fewer people to feed data to. That amounts to major cost cutting, so even if revenues drop a little but are offset by lower costs then they win.
You can lead a horse to water, but you can't make it dissolve.
You could just do what millions already know. To get true HD quality with total portability. AND
....
an unmatched selection of titles
Including the newest titles anywhere...
use BITTORRENT !!!
who prays for Satan? Who in 18 centuries has had the humanity to pray for the 1 sinner that needed it most? ~Mark Twain
Netflix did better than I thought they would. They only lost 4% of their subscribers over this, and it looks like their revenue is going to go up. Pretending that everyone was on the cheapest plan, they used to have 25 million subscribers paying $10 a month for $250 million/month. Now they have 21.8 million paying for streaming and another 14.2 million paying for DVD, each at $8 a month for a total of $288 million/month. Since the price of the larger plans didn't change as much as the cheapest one, I think it is safe to say that they will be making more money when this is done than they did before.
Suppose they had given a $2 discount for people on both plans, like I thought they should. They would have increased revenue further by doing that if everyone stayed, and 2.6 million more people decided to go with both plans, or alternately if the same number left but 4 million decided to have both plans. Of course, that doesn't consider increased costs of both plans.
So according to TFA, Netflix had 12 million people paying $10/month for streaming+DVD. Those 12 million people will now pay $16/month. That's an extra $72m/month.
10 million (like me) are streaming only at $8/month. They're losing 200,000 of those, or $1.6 million/month.
3 million get the DVD only plan. They're losing 800,000 of those. I don't know what the average DVD only customer pays, but let's be generous and say it's $20/month. This'll cost Netflix $16m/month. They're still $55 million/month in the black.
So you're all saying Netflix has done something really stupid because they're...making more money?
Netflix has pissed people off simply because people don't want to pay more, not because the service isn't worth it. I get TONS of value for my $8/month. I may get around to adding the DVD bit for those shows I can't stream because another $8/month is peanuts. I spend more than that for one movie ticket. I spent more than that on lunch today. But somehow I'm supposed to be all outraged that a service I actually like wants me to pay that much to watch movies all month long. I just don't see it. Sorry.