Wednesday, July 13, 2011

Netflix can't compete with Netflix

Dammit! My Netflix is about to get 60 percent more expensive. While I was paying about ten bucks for unlimited streaming of movies and one DVD out at a time, I will soon have to pay about sixteen bucks for the same service:
In a reflection of the more challenging economics, the company faces to acquire digital content and ship DVDs, Netflix announced Tuesday that it will no longer offer combined DVD and streaming plans. Instead, the company's more than 22.8 million U.S. consumers will have to pay separately for each service.

Unlimited streaming will cost $7.99 per month, as will taking out one DVD at a time. The combined cost is $15.98 per month, a huge price increase for those who currently pay $9.99 for a combined streaming-plus-one-DVD plan.

In a blog post, the company positioned the price increase as a way to bolster its DVD business, which executives had previously deemphasized.

"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," the corporate blog post said. "Creating an unlimited DVDs by mail plan (no streaming) at our lowest price ever, $7.99, does make sense and will ensure a long life for our DVDs by mail offering."
Perhaps I'm spoiled. After all, I originally signed up when it was just the DVDs for about $9 per month. When they added the streaming, that was gravy. The one-DVD-out-at-a-time service meant, if I watched movies the day I received them and got them out the next day, I could watch about two a week, or about $1.25 per film. That's a 25¢ more than at the Redbox or Blockbuster kiosk, for those keeping score.

But at the same time, I was able to watch as many movies and television programs as I wanted on their streaming service. Lately I've been going through the entire Battlestar Galactica reimagining, as well as South Park. I have a Hulu+ membership (about $8 per month) for more recent television shows.

The problem with Netflix's streaming service is that there are a lot of missing movies. Half the things I'd like to see are available only on DVD, including all the Harry Potter movies I might want to watch before I see the final installment. The question now is whether I want to keep the DVD service at all.

At least I have until September to decide. I should see how many recent movies are at the local library.

UPDATE (September 18, 2011):
Well, it looks like Netflix went and decided for me. If the change described in their blog does go through and there is little integration between sites, I will probably quit their mailing service, possibly even returning to Blockbuster (why I left is explained here).

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