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NetFlix announces new plan and price increses

post #1 of 75
11/22/10 at 8:42am
Thread Starter 
NetFlix has now officially launched a streaming only plan for $7.99 per month.

At the same time NetFlix has increased the the prices of their DVD plans as follows:

1 DVD $8.99 to $9.99
2 DVD $13.99 to $14.99
3 DVD $16.99 to $19.99
4 DVD $23.99 to 27.99
5 DVD $29.99 to $34.99
6 DVD $35.99 to $41.99
7 DVD $41.99 to $48.00
8 DVD $47.99 to $55.99

The limited 1 dvd plan (2 DVD's a month) remains at $4.99.

Complete blog entry can read at http://blog.netflix.com/2010/11/new-...ntly-plus.html.
No DVD only option for those of you who do not use the streaming feature.

Existing customers will roll over to the new pricing on 01/01/2011. I'll assume that this will be based upon your billing cycle. You can go ahead and change your plan now but you can not return to that plan. The new plans are in effect immediately (11/22/2010) for all new customers.

Blue Ray pricing remains the same

If you go to your membership page and click on Change Plan. At the top of the new page you will see:

"Your plan is no longer offered"

"You are currently on the 3 DVDs out at-a-time (Unlimited) for $16.99 plan which is no longer offered. If you select a new plan, you will no longer be able to return to this plan."

Notice that the DVD unlimited plans show the new prices.
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post #2 of 75
11/22/10 at 9:22am
How do you think they are paying for the $1 billion Epix fiasco?
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post #3 of 75
11/22/10 at 9:34am
Quote:
Originally Posted by moviegeek View Post
How do you think they are paying for the $1 billion Epix fiasco?
Not sure I'd call $1 a fiasco in today's world. If you want streaming only it has actually dropped in price to $7.99 (from $8.99 your only previous option). Looks to me they are raising the prices for DVDs rather than streaming... notice the large increases as the number of DVDs go up. It's going up $1 per DVD.

According to the chart I posted in another thread DVD usage has plateaued so perhaps they need to generate more income per DVD to maintain the same revenues per DVD (customers are subscribing to lesser plans as their disc usage goes down).
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post #4 of 75
11/22/10 at 9:37am
I'd call it a fiasco because netflix paid too much for epix content. Now they expectedly pass the cost the subscribers. Glad I am on the 1 disc plan.
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post #5 of 75
11/22/10 at 9:40am
$1 increase, gee I'm going to have to consider my options now.

No, I'll stick with my disc and streaming with BD when available. Too many movies that don't get streaming and I sometimes I even see a film streaming and want to see the extras and commentary available on the disc.
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post #6 of 75
11/22/10 at 9:53am
I called and the Rep stated existing customers will be converted to the new pricing on 1/2/11 and there will still be an additional charge for Blu-ray.
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post #7 of 75
11/22/10 at 9:59am
Quote:
Originally Posted by Cygnus2112 View Post
I'd call it a fiasco because netflix paid too much for epix content.
Can you provide a link that proves they paid too much? Perhaps the deal allowed to to keep the price lower... via signing up x number of new subscribers. Not opinions are there any facts to show they overpaid? Such as cost versus related increased revenues? I love to see them!
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post #8 of 75
11/22/10 at 10:00am
When you add in bluray costs to the plans I am debating dropping discs from my plan and going streaming only (and using the zune 1080p service for new releases). I am already on the 1 disc at a time plan now so I don't get that many discs anyways (and have been using zune more because of the 30 day window on most netflix new releases of movies I really want to watch when they are out). I am probably going to keep bluray for now however but its getting really close to me just dropping bluray and selling my player (just because zune rentals are still very expensive).
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post #9 of 75
11/22/10 at 10:13am
I was speaking my opinion on the Epix deal. From the day it was announced I felt that netflix should have waited because time was on their side. Cable and sat companies were not signing up with epix and epix needed to make a deal badly. Because netflix paid so much for epix now starz will demand more $$.

Quote:
Originally Posted by Charles R View Post

Can you provide a link that proves they paid too much? Perhaps the deal allowed to to keep the price lower... via signing up x number of new subscribers. Not opinions are there any facts to show they overpaid? Such as cost versus related increased revenues? I love to see them!
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post #10 of 75
11/22/10 at 10:36am
Quote:
Originally Posted by Cygnus2112 View Post

I was speaking my opinion on the Epix deal. From the day it was announced I felt that netflix should have waited because time was on their side. Cable and sat companies were not signing up with epix and epix needed to make a deal badly.

Dish Network has had several Epix Channels for quite a while (knowing Dish they got them cheap). Personally I'd like them to break streaming into Movies and everything else. At least take the pressure out of including newer movies in the lesser price plans. Going forward I don't think they can keep the everything package in place... assuming the growth rate continues (for a while). Hulu Plus is charging the same $7.95 and offering a lot less content although a much nicer image.
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post #11 of 75
11/22/10 at 11:42am
Going from 3 at a time to 2 or maybe 1.

Looks like they will be losing revenue to me.
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post #12 of 75
11/22/10 at 11:55am
Quote:
Originally Posted by EscapeVelocity View Post

Looks like they will be losing revenue to me.

It does look like they are trying to get people to drop to the lower plans... by increasing the upper tier plans the largest percentage. I wonder if the lower plans are the most profitable?
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post #13 of 75
11/22/10 at 11:56am
I think Reed wants ppl to switch to 2 or 1 at a time since the postage/disk costs are greatly reduced. Thus I doubt they will lose much revenue if ppl lower their disk at a time subscription. I am happy with 1 at a time as I can get about 8 disks per month.
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post #14 of 75
11/22/10 at 1:40pm
Is it just me or is anyone else disappointed with the shift to more and more online streaming when it is (to me at least) clearly inferior in both audio and video quality?

For all the money we invest in home theater systems, it's a shame to see it wasted by throwing inferior source material at it, not to mention the current lack of selection. I have this sinking feeling that it won't be long before there simply is no option for disc rental and that will be a real shame.
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post #15 of 75
11/22/10 at 2:01pm
Quote:
Originally Posted by JN99 View Post

Is it just me or is anyone else disappointed with the shift to more and more online streaming when it is (to me at least) clearly inferior in both audio and video quality?

You aren't the only one. Although I find it exactly the opposite. Up to a few months ago I had a 1080p projector/119 inch screen/killer speakers/etc and I had a hard time finding several Blu-ray movies a month worth firing everything up for. So much so I haven't missed it much and I have been taking my time in selecting my third edition theater.

I do most of my viewing in my den with a 61 inch set and now that I'm streaming at 6Mbps the quality isn't painful. Streaming is about choices. I have over 100 items in my Instant Queue which is probably closer to 500 items if you count individual shows (within series). My DVD/Blu-ray queue has less than twenty and a lot of them are filler I'll never get to.

I see it very similar to Pandora (which I have been listening to for the last several hours). I would never go out and purchase or wait for all the music I have been listening to show up. I'm sure the quality isn't the same as my lossless rips (of my own albums) but I rather listen to thousands of other songs I enjoy that I wouldn't listen to any other way.
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post #16 of 75
11/22/10 at 3:12pm
Quote:
Originally Posted by Brian Conrad View Post

$1 increase, gee I'm going to have to consider my options now.

No, I'll stick with my disc and streaming with BD when available. Too many movies that don't get streaming and I sometimes I even see a film streaming and want to see the extras and commentary available on the disc.

That $11.99 plus 8.75% CA sales tax comes to $13.04. The difference between that and the $7.99/month streaming-only plan ($8.69 with tax) is $4.35/month. It'd be nice to have access to rent BDs if I want them, but I'm not watching them--I held one disc for nearly a year without watching it. That's definitely not worth $52.20/year--I could buy a couple of new release BDs for that. I'm switching to streaming-only.

I wonder how many other people switched today with that announcement? Doesn't seem to have hurt their stock--they're up $7.80 in today's trading (to $188.81/share).
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post #17 of 75
11/22/10 at 5:09pm
If Netflix had there full DVD selection available to download, I would ditch the discs.

That isnt the case.

If Hulu Plus had their full Hulu content available, I would sign up, but they dont.
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post #18 of 75
11/22/10 at 6:33pm
Don't forget how many increases we have seen already.
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post #19 of 75
11/22/10 at 7:23pm
I see a real battle shaping up between Netflix's desire to stream everything and those who control the wire into our homes. The cable and phone companies, who provide the vast majority of broadband access and most of our video content, are not going to give this up to Netflix without a fight. Comcast already limits internet downloads to 250 gigs a month and my DSL gets 5 megs on a good day and oftentimes half that in the evenings. What is to stop them from continuing these limitations? I wonder how Netflix is planning on dealing with that?
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post #20 of 75
11/22/10 at 7:46pm
Quote:
Originally Posted by Taperwood View Post

Comcast already limits internet downloads to 250 gigs a month and my DSL gets 5 megs on a good day and oftentimes half that in the evenings.

When I signed up for DSL (ATT - 6Mbps) I was getting as low as 1Mbps during prime time and close to six off hours. Anyway after a week or two of travelling through various support tiers I ran across someone who finally changed my circuit. Since then I get at least 5.2Mbps any time of the day. If you want a contact send me an PM and I'll forward the info.
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post #21 of 75
11/22/10 at 7:46pm
I also wish they would offer the DVD extras in conjunction with the streaming.that would make it easier to consider streaming only .

I worry about the bandwidth police... There are too many times when things slow to a crawl... Nice to be able to pop in a disc when the Internet is misbehaving (or being sabotaged by cable co).

for now I will probably drop down to 2 at a time from 3 ... Occasionally we enjoy a multi disc show and waiting for vol 2 means you lose continuity . That said, I've had the three discs I have home now for around 4 wks so it's kind of a waste of money. Two should be ok for now.

Logistically , do we switch plan and return the extra disc or vice versa. They just don't send you another til you've returned two?

I was under the impression that hike would kick in at the regular billing date after jan2 -- not that all billing would switch on that date. Anyone know for sure?
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post #22 of 75
11/22/10 at 8:19pm
This is what happens when a company goes from being an innovator in the marketplace to a big comapny with shareholders and directors only looking at margins and profit.

If you are a Blu-Ray user, I suggest looking back into Blockbuster. It's cheaper, they rent games under the same plans, and they have release day rentals from Universal, Fox, WB, and Sony.

Just my suggestion. I used to love Netflix, but it is ovious to me they no longer cater to my preferences. I have no problem taking my dollar to those that do.
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post #23 of 75
11/22/10 at 9:40pm
Good suggestion.

Competition in the marketplace is good.
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post #24 of 75
11/23/10 at 4:23am
I thought blockbusters went bankrupt. They shut down stores in our neighborhood. Agree w ideas about competition but netflix has been a great deal for so long I'm not quite at the "take my marbles and go home" stage.

Re cost increase schedule... I'll answer my own question fr above. Letter they sent said: "The price of your current plan is changing from $16.99 a month to $19.99 a month. This new price will be effective with your next billing statement on or after January 2, 2011". My billing is the 27th of the month so presumably I have til then to decide. Will probably keep 3 through the holidays and drop back to 2 at a time, since I'm really not watching discs frequently enough to justify the convenience of the occasional 3 part series. In addition to streaming there's always amazon and apple rental options for spontaneous viewing, and a backlog of recorded stuff that could keep us busy for quite some time if the cable goes out. I had been thinking of scaling back anyway so this will just motivate me to actually do it. Hope they don't give up on the more esoteric diisc acquisitions ... they would be foregoing one of the major selling features compared to the competition ...their broad and diverse inventory.
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post #25 of 75
11/23/10 at 5:30am
My 3 at a time is going from 20.99 to 23.99.

I find the timing of the price increase odd. You think they'd want to just keep it the same for another 6 months to drive the final nail in BB's coffin (although I personally think that was driven several years ago and they're just still clawing at the lid).

I'm not sure I'll pay it or drop down to 2-at-a-time. I like having 3 discs at home.

Realistically, if I didn't hate BB with the intensity of a million suns (and if they'd actually ship discs the day they receive them and I could get them in 1 day instead of two because they're shipping center is so far away) I'd probably get a streaming plan from Netflix and a disc plan from BB until BB goes completely under.
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post #26 of 75
11/23/10 at 6:17am
It was a great ride while it lasted.

Less than 2 years ago it was 3 at a time for BD at $17 per month, and service was great until about 3-4 months ago. We have not been able to receive a new movie in 4 months, and now the price is raised to $24 per month?

That's two major price increases in less than two years.

Streaming is not available here.

Why on earth would I want to pay $288 plus tax per year for old movies I can watch on TV for free?
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post #27 of 75
11/23/10 at 6:53am
Thread Starter 
Somebody asked why are they doing it know. My take, NF is anticipating a large increase in new customers over the next several months; especially right after Christmas and into January. Historically NF reports large subscriber increases for the 1st quarter of the year. They do not want these new subscribers to sign up at one price and thing get hit within 90 days with a price increase.

The subscriber looks at how much money he/she is sending to NF every month and makes a decision on the value returned for that money. On the other hand, NF looks at that same money and see how much profit NF can make every month. The subscriber and NF have a totally different perspective on that same money. NF probably does not care if you downgrade from 3 out to 2 out. The amount of profit to NF is probably almost the same. But the subscriber probably thinks they are getting a better value. Everybody walks away happy. Just something to think about. The big unknown is how they allocate costs to the various plans and how profitable the various plans out. This is why I think you saw the large price increases in the 3 out and higher plans. Remember that it has been reported that it cost NF about $1.00 for shipping and handling of each DVD.
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post #28 of 75
11/23/10 at 8:30am
Quote:
Originally Posted by HoustonPerson View Post

Streaming is not available here.

You mean that there's no broadband Internet service available to you?
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post #29 of 75
11/23/10 at 9:13am
I also wonder what will happen as bandwidth gets used up more and more. As Taperwood said, the cable co's are going to want their share of the pie and will likely limit bandwidth and charge more for it as streaming marketplace grows (and how far can it grow before gridlock?).

I don't see the issues some have mentioned with waits on discs, not sure why - maybe it's a regional thing. Discs are still the way to go for quality and selection and I prefer them for both reasons. Even if Netflix had more available for streaming the quality is still inferior to a disc, especially blu ray - and I don't see it improving because of the worries noted about bandwidth and the cable police.

But right now, selection is terrible. Just today I popped open Netflix and of the 23 titles displayed to me on the "main" page - only 3 were available for streaming and of the 40 displayed under New Releases, only 1 (ONE!) was available for streaming.
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post #30 of 75
11/23/10 at 9:14am
Wow I can't believe the number of ppl complaining. BTW to the complainers, have you called NF and told them how you feel about the price increase, lack of streamed titles, BR, etc? While NF is not perfect, it still is a great value. I hope with the increased revenue NF can acquire more HD streaming deals and get more DVDs. As I mentioned before, Reed wants most subscribers to go to streaming only, 1 or 2 disc plan. That way their postage, distribution center, and disc supply costs lower substantially.
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