Netflix Raising Prices, DVD & Streaming

Well, it was only a matter of time until the prices went up, I guess. Netflix has updated their official Netflix Blog with a blog post (here) that states the following price raises:
First, we are launching new DVD only plans. These plans offer our lowest prices ever for unlimited DVDs – only $7.99 a month for our 1 DVD out at-a-time plan and $11.99 a month for our 2 DVDs out at-a-time plan. By offering our lowest prices ever, we hope to provide great value to our current and future DVDs by mail members. New members can sign up for these plans by going to DVD.netflix.com.

Second, we are separating unlimited DVDs by mail and unlimited streaming into separate plans to better reflect the costs of each and to give our members a choice: a streaming only plan, a DVD only plan or the option to subscribe to both. With this change, we will no longer offer a plan that includes both unlimited streaming and DVDs by mail.
Gulp. So, that means those of us who are used to the unlimited streaming and unlimited DVD rentals (with one out at a time) will have to choose between one of the following plans:

Plan 1: Unlimited streaming (no DVDs) for $7.99 a month
Plan 2: Unlimited DVDs, one out at-a-time (no streaming), for $7.99 a month.
Plan 3: Unlimited streaming AND unlimited DVDs (one out at a time) for $15.98 a month ($7.99 + $7.99).

With licensing fees seeming to skyrocket, this price hike seemed inevitable, albeit a little more pricey than I originally expected.

This is Netflix's "official" reasoning behind the raise in price:
Last November when we launched our $7.99 unlimited streaming plan, DVDs by mail was treated as a $2 add on to our unlimited streaming plan. At the time, we didn’t anticipate offering DVD only plans. Since then we have realized that there is still a very large continuing demand for DVDs both from our existing members as well as non-members. 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. 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.
What do you think of the raise in price? Obviously, we're very much focused on the streaming side of Netflix, but we still loved being able to get a DVD every so often of something that wasn't coming to streaming anytime soon. We'd love to get your input and see how this affects your opinion of the Netflix service.

Leave a comment!

24 comments:

Allison said...

Well I am definitely going to have to choose between streaming and DVD. I am thinking I will just stick with the streaming and get DVDs from the local Red Box. $16 plus tax is not worth it for me. I think you are going to lose a lot of customers.

Jamie said...

If I still have to pay extra for blu-rays after this I will be dropping my dvd plan.

Joe said...

I agree with the above comments. One thing will have to go. $120 per year (including taxes) for streaming and 1 DVD at a time is reasonable. Over $200 per year is not.

Ryan said...

@Jamie: Bluray access is still $2 more for each plan. My 1 BluRay (Unlimited) + Streaming plan is going up to $17.98 before taxes.

jerrywrite said...

Netflix over-reached and now the subscriber will have to pay. i'm not sure it's worth it. in fact, i'm sure it's not. and with Netflix trying to outbid HBO and STARZ for first run rights, there is probably no end in sight for the price hikes. I wish you luck, but not with my money.

MikeTeeVee said...

For us, we mostly stream, and rarely watch DVDs. So we'll go to streaming only and save some money.

I'm guessing Netflix is expecting this. They probably expect to get new $8 streaming customers and new $8 DVD customers. Lower the a la carte price and make it up on volume.

Even the combination price is similar to what we paid a couple years ago. But Netflix apparently feels a big chunk of their current/future customers will be streaming-only or DVD-only.

Jake said...

I immediately changed my plan to streaming only upon hearing this news. $15.98 is too expensive for three or four DVDs a month.

Andrew Peacock said...

I don't have any problem paying $8 for streaming only. It's what I have now and I never have a need to rent DVDs. If the separation means even more and newer content coming to streaming, then I'm all for it.

Anonymous said...

What do I think? I think they are greedy assholes is what I think.

Anonymous said...

They will only be losing money from me. I'm going to stick with the DVD rentals so keep that postage money coming Netflix! The streaming movies aren't that great to begin with and I doubt they will be throwing any extra money towards expanding the library.

Anonymous said...

I actually don't like the streaming service since it seems like most movies I want to see aren't available via streaming. I'll probably drop the streaming service.

kiwikit said...

I'm going to opt for DVD only. I can stream free from
Amazon and I've not noticed any increase in what's available for streaming in the last year. I get the DVD's
only when streaming is not available but that seems to be more and more. If the total library were available in both, this would make sense but until it is, I'll stick with the larger library: DVDs. I know Netflix would prefer
users stream, but they must do their part and convert the library, before I do it.

Wendee said...

Huh. I feel old fashioned. I remember the $3-$4 video rentals from the local video store each weekend with the inevitable late fee. Seemed like and easy $20 a month for us and that was 15 years ago. We opt for both streaming and DVD's. No cable or conversion box. We use the hell out of both and think it's a great deal - even with the raised prices.

Anonymous said...

I think it sucks. Their streaming library is weak and 1 DVD at a time is only about 4-6 DVD's per month. So, you need both, if you truly want the best service. Hmmmm....I may be cancelling my service once the new rate kicks in.

Anonymous said...

I switched to streaming at the first two dollar increase, with this coming many will be stuck between keeping the instant streaming especially when instant rentals are becoming more available with redbox at $1 a night, and then Zediva which offers $1 rentals that can be HDMI to the TV withou the netflix/redbox 28 day wait for popular new releases. Zediva has got my business!

jon said...

There is a high probability that my wife and I will be cancelling our netflix account. A 60% increase with no added value is a waste in these economic times. Their streaming is too weak to keep by itself and I'm not willing to pay more for the exact same....

Anonymous said...

If the content will expand and improve, I'm happy to pay a bit more.

A fancy Starbucks drink costs almost $5 a pop. Abstain from one Starbucks per month and make up for the cost of the Netflix hike.

Anonymous said...

"Since then we have realized that there is still a very large continuing demand for DVDs both from our existing members as well as non-members."

Translation: "Ooops we underestimated hollywoods greedy stance towards Lo-Q streaming."

Not sure how this will increase revenue - In reality, for me, streaming provided royalties for shows/movies I would *not* have watched if I waited for the DVD.

I'm thinking; its *really* about big studios shutting out smaller (indie) threats?

Christy said...

It's not exactly affecting me. I stopped getting DVDs from Netflix and switched over to streaming only just recently because I ended up keeping DVDs around for weeks and weeks. I am hoping, however, that they will add more to their streaming. For new release movies, I just go to RedBox so I'll be forced to watch the movie right away and just pay $1 for the night. This way is costing less than when I was getting 2 DVDs + streaming with Netflix since I wasn't watching the DVDs as often.

Anonymous said...

THIS AFFECTS ALL CUSTOMERS. DON'T BE FOOLED. EVERY PRICE CHANGE, EVEN IF YOU DON'T NEED DVD'S AND YOUR PRICE GOES DOWN. THIS IS A STEP CLOSER TO STREAMING PRICES GOING UP. I WISH SOMEONE WOULD DO A MASS ADVERTISEMENT TO HAVE ALL UPSET NETFLIX CUSTOMERS TO TERMINATE THEIR SERVICES SIMULTANEOUSLY. I PICK AUGUST 31, 2011 !

Gordon said...

I'll be cancelling my account entirely and using Redbox. So long Netflix, it was fun while it lasted.

Anonymous said...

I'm quite happy with the new Netflix pricing announcement. I've never used "streaming", as the available titles are about 20% of what I want to watch, so I immediately switched to DVD only. I actually save $8/mo when the price increases on Sept 1. That's $96/yr in my pocket. I think most customers will choose streaming only or DVD only, but not both as a 60% increase for both is way too much. When all is said and done, Netflix will lose revenue, potentially $2.3 billion/yr if all 23 million customers pay $100 less per year. It's obvious the bean counters and executives didn't do some simple 5th grade math when announcing this "divide and conquer" pricing plan.

Linkavich said...

I've always thought the cost for Netflix was astoundingly low.
I originally started with Blockbuster Access but after a couple price hikes and them throttling my DVDs, my boyfriend got me Netflix to try out. For the same price I got a lot better turn around on my DVDs PLUS streaming.
While streaming does not have the latest movies, it really does have a lot of stuff, especially if you’re willing to browse (special thanks for the help from this blog!). It wasn’t long after we got hooked up to Netflix streaming, we cancelled our cable. I liked Netflix so much I got it and a Roku for my mom for Christmas one year. Being a two Blockbuster movies a week (from the store) kind of girl, it saved her a lot of money. She still does not use the streaming as much as she could - but its slowly changing as she tell me about movies she watches for 3 hrs on cable and I point out the same movie on Netflix streaming and is really only 2 hrs long (look ma, no commercials!).
While I’m not thrilled about the price hike, I understand it. I’ve heard they’re switching the focus from DVDs to streaming and are working to get a lot more into the system. I hope this helps them out in this endeavor. I also hope they use some of the money for lobbying against internet caps. I’m planning on playing right into their plan: I’m dropping from streaming and 2 to streaming and 1. Going to give Redbox and Amazon a swing (but NOT Hulu, they still have evil commercials).

Anonymous said...

Hey Netflix----Sha-na-na-na sha-na-na-na hey hey hey good bye!

Reply

Related Posts Plugin for WordPress, Blogger...

Follow Us!