If you didn't like the Netflix redesign, you're going to love this. Pricing adjustments!
Netflix announced today that it is doing away with member plans that let you get both unlimited DVDs and unlimited streaming - something many of us have been enjoying for some time. You can still get both, but it will be two separate plans, and it's going to cost you.
You can get unlimited streaming with no DVDs for $7.99 a month or Unlimited DVDs (one at a time) and no streaming for $7.99 a month. Or you can get both plans for $15.98 a month.
Clearly members who don't want to pay that much for something they've enjoyed for significantly less, are now faced with a choice. With streaming, you can watch a lot more, but with DVDs, you can get access to a lot of stuff that isn't available through streaming. Keep in mind that Netflix already has to wait a month after DVD release to get a lot of the new releases as it is. Of course there is another choice: find a different service. Something tells me Redbox and the recently acquired-by-DISH Blockbuster are going to benefit from this.
So why the changes? Here's the explanation from the Netflix blog. Jessie Becker writes:
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. Reflecting our confidence that DVDs by mail is a long-term business for us, we are also establishing a separate and distinct management team solely focused on DVDs by mail, led by Andy Rendich, our Chief Service and Operations Officer and an 11 year veteran of Netflix.
Here's a sampling of the comments so far (also from the blog):
"Are you F#**!!@! kidding me?"
"Way to go again Netflix - Divide and Conquer - EPIC FAIL!!"
"This will cost you some customers. Will you be able to break even?"
"I guess it's finally time to cancel my Netflix subscription. DVDs + Streaming gave me a great bang for my buck, but by not offering any sort of bundling discount for those wanting both, I can't justify sending you my money every month."
"I know I'll be cancelling my service and going with Blockbuster soon."
"Sept.1 I'll be canceling.I do without cable I think I can do without Netflix."
"Peace out. You're streaming selection is horrible anyway."
"Sounds great to me! The amount of use I get out of my Netflix account means I'd be willing to pay more (sorry whiners, but $16 is ridiculously cheap for unlimited anything, you can't get a good cable package for that price). I hope this means much more streaming content in the future."
The new plans go into effect for new members immediately. For existing members, they'll kick in in September.
Oh, they tweaked some of their recent design changes though.