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Netflix raises prices, splits DVD & instant viewing into different plans

Posted at 13 July 2011 00:22 CEST by Justin_Massoud

Netflix announced on Tuesday a major change to its subscription-based services. Starting in September for current members, the singular unlimited DVD and streaming deal will be split into two different services: one focused solely on DVD rentals, and the other offering the online streaming service which helped the company expand over the past few years.

Jessie Becker, Netflix Vice President of Marketing, outlined the upcoming changes and explained that separating the $9.99/month unlimited DVDs and streaming plan into two unique options was a matter of better supporting its disc-based rental system.

“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,” wrote Becker at the company’s official blog. “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.”

The move leaves those enjoying both DVDs and streaming for one low price with two choices: unlimited streaming for $7.99/month, or unlimited DVD rentals for $7.99/month. If you want both, expect to shell out $15.98 each month. Put simply, Netflix is raising its prices. Becker says the distinction is important.

Continuing to treat DVD as a bonus to Netflix’s streaming service would be a mistake, reasoned Becker – adding that he foresees a “long life” for the company’s DVD by mail service. To that end, Netflix is creating a new team to oversee its renewed focus on that aspect of its business headed by Andy Rendich, the company’s Chief Service and Operations Officer.

Of course, there is always another option: subscription cancellation. Based on reactions to the announcement thus far, it seems many long-time subscribers could be opting for that one.

“The whole point is that we use the streaming primarily and only order a DVD when you don’t have it available for streaming, thus the $2 per month for DVDs makes perfect sense,” an anonymous commenter said, adding, “You guys have really messed up here.”

Others voiced various threats to seek the greener pastures of competitors such as Amazon Prime, HBO GO, Redbox and Blockbuster. The announcement does currently boast 16,000 “likes” on Facebook, however.

This isn’t the first time in 2011 that Netflix has angered customers. Controversial changes to its user interface, open API and programming offerings in recent weeks elicited varying degrees of subscriber fury. The company confirmed last week that it would be bringing its services to the Latin American market later this year, and some expect it to launch in European territories by next year.

Which service option will you vouch for? Both? Or is this the move that sends you into the arms of a Netflix competitor? Let us know in the comment section.

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There are 8 comments

DevilDog2019
New Member
Posted on: 14 Jul 11 15:48
    Here is my email from netflix

    We are separating unlimited DVDs by mail and unlimited streaming into two separate plans to better reflect the costs of each. Now our members have a choice: a streaming only plan, a DVD only plan, or both.

    Your current $41.99 a month membership for unlimited streaming and unlimited DVDs will be split into 2 distinct plans:

    Plan 1: Unlimited Streaming (no DVDs) for $7.99 a month
    Plan 2: Unlimited DVDs, 6 out at-a-time (no streaming) for $32.99 a month

    Your price for getting both of these plans will be $40.98 a month ($7.99 + $32.99). You don't need to do anything to continue your memberships for both unlimited streaming and unlimited DVDs.

    These prices will start for charges on or after September 1, 2011.

    You can easily change or cancel your unlimited streaming plan, unlimited DVD plan, or both, by going to the Plan Change page in Your Account.

    Others may have gone up, but mine went down.
    justcallmebob
    MyCE Resident
    Posted on: 14 Jul 11 15:50
      Mine went up from $14.99 to $19.98 . . .
      getit29
      MyCE Resident
      Posted on: 15 Jul 11 06:56
        Netflix or should I call it Nutflix is trying the Blockbuster business approach of lets just
        go right ahead and squeeze every penny out of our subscriber base until they all say
        the hell with it and leave us and we have to file bankruptcy at least it seems that way
        to me.

        I do not use the streaming video service all that much anyway so I will drop it like a hot
        potato next month before my next payment comes due no use paying for something that
        I might use once or twice or less every month or two.
        justcallmebob
        MyCE Resident
        Posted on: 15 Jul 11 15:13
          We actually use the streaming option more than DVDs. I've got two discs at home right now. I've had one of them since the first part of May. I just haven't taken the time to watch it or send it back (127 Hours).
          coolcolors
          MyCE Resident
          Posted on: 17 Jul 11 04:54
            I myself will drop the streaming as they don't have enough of my selection to stream and also I like the choice of when I like to stream and/or watch DVD.

            So here some scope of why they jacked the prices and change the subscription on users:

            Quote:
            What’s not mentioned is the reason behind this change. According to CNN Money, Netflix has been forced to hike prices because it needs to find some extra $2 billion in content costs for the studios next year. That’s not walking around money, and it seems that Netflix is asking customers to turn out their pockets to foot this bill. ZDNet editor-in-chief Larry Dignan agrees - “Netflix’s price changes are all about the dollars.”
            This is one reason pirates exist and torrent and p2p continues to grow and grow. It just looks like NF forgot what made it great and popular with it's subscriber base.
            coolcolors
            MyCE Resident
            Posted on: 17 Jul 11 04:59
              I myself will drop the streaming as they don't have enough of my selection to stream and also I like the choice of when I like to stream and/or watch DVD.

              So here some scope of why they jacked the prices and change the subscription on users:

              Quote:
              What’s not mentioned is the reason behind this change. According to CNN Money, Netflix has been forced to hike prices because it needs to find some extra $2 billion in content costs for the studios next year. That’s not walking around money, and it seems that Netflix is asking customers to turn out their pockets to foot this bill. ZDNet editor-in-chief Larry Dignan agrees - “Netflix’s price changes are all about the dollars.”
              This is one reason pirates exist and torrent and p2p continues to grow and grow. It just looks like NF forgot what made it great and popular with it's subscriber base. As a result of this I myself will be dropping the combination and just go with having more DVD and loose the streaming option. For my money DVD is far better value to watch. And what else I miss I can get them at my local library for free of which I am a member at. This is what is going to happen to NF. Users will go to their local library and RedBox or BB and forgo what used to make it convenient to go NF to begin with. That is what is going to happen to NF they will most certainly loose profit over doing this rather then making profit. Twitter and Facebook haven't had good response to what they did either so you can guess what the rest will say.
              sgmvideo
              MyCE Junior Member
              Posted on: 19 Jul 11 14:41
                Is this the beginning of the end for Netflix? Blockbuster also abused its customers with significant price increases and reduced service that drove them from being number one in the business and into bankruptcy.
                If Netflix wants to get out of the dvd business then just do it. Most new dvd releases are not even available from Netflix for 30 days after release...and Netflix does not offer new releases in its streaming.
                How long will people stay with Netflix streaming just watching old movies/tv shows remains to be seen. But if they ever tamper with the streaming price, my guess is that a mass exodus will occur.
                All Netflix has accomplished with it's significant dvd price increase is left a bad taste in the mouths of it's present customers. Once you piss off people, they are likely to cancel the service and go somewhere else even if it does cost them more.
                Hey Netflix-take a hint-people do not like to be abused with price increases without an increase in service especially in this economy. Your competition is watching. Remember, you are NOT to big to fail....just ask Blockbuster!!
                justcallmebob
                MyCE Resident
                Posted on: 20 Jul 11 14:13
                  As long as they keep relatively new TV series available as part of the streaming service I can see folks sticking with them.

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