Print 56 comment(s) - last by gmanthebrave.. on Sep 28 at 12:59 PM

U.S. subscriber predictions have been cut from 25 million to 24 million

Netflix has had a lot of troubles since it began making big changes to its service. It first increased the prices of its plans back in July, which outraged customers to the point of jamming Netflix's customer service phone lines.

To make matters worse, Starz decided not to renew its contract with the company because Netflix wouldn't make subscribers pay a premium price for Starz content. This means Netflix will lose Disney and Sony-related programming come February.

Now, Netflix is 
cutting its third-quarter forecast by 1 million U.S. subscribers, and has realized the full extent of customer wrath since raising plan prices by 60 percent as well as splitting DVD plans from streaming plans. 

"We know our decision to split our services has upset many of our subscribers, which we don't take lightly, but we believe the split will help us make our services better for subscribers and shareholders for years to come," said Netflix. 

The company is now predicting 24 million U.S. subscribers by the end of the third quarter, which has been reduced from a previous forecast of 25 million. Originally, Netflix predicted that 3 million subscribers would move to the DVD-only plan while 22 million would transfer to the streaming-only plan. Now, these predictions have fallen to 2.2 million DVD-only subscribers and 21.8 million streaming-only subscribers. 

"Clearly, if the third quarter is slipping, there's risk to the fourth quarter, as the year-ago period was a time when everything went right for Netflix," said Barton Crockett, a Lazard Capital analyst.

Despite the cuts in U.S. subscriber predictions, Netflix has maintained its third-quarter financial forecast and international subscriber outlook. 

Netflix has said that it needed to raise prices in order to 
afford the hundreds of millions of dollars it takes to purchase licensing rights from movie studios and television networks. These licenses help Netflix build its digital library. 

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By Stuka on 9/15/2011 2:06:26 PM , Rating: 5
Originally, Netflix predicted that 3 million subscribers would move to the DVD-only plan while 22 million would transfer to the streaming-only plan. Now, these predictions have fallen to 2.2 million DVD-only subscribers and 21.8 million streaming-only subscribers.

Where is all this streaming content that's getting people all wet? I don't see it.

RE: Seriously...
By retrospooty on 9/15/2011 2:14:09 PM , Rating: 2
There really isn't alot of top tier movies available for streaming. There are alot of old (and some new too) TV shows, but movie selection is poor. Netflix is saying they needed to raise prices to secure contracts with production companies in order to get a much better selection of top tier movies... Hopefully next year we will start seeing better content.

RE: Seriously...
By mcnabney on 9/15/2011 4:03:41 PM , Rating: 2
it is good that Netflix found a sucker to keep paying for lousy content in the meantime.

RE: Seriously...
By omnicronx on 9/15/2011 4:44:58 PM , Rating: 1
The leave and go find another provider that can still save you 50+ dollars a month if you were to forgo TV service which many people do..

Oh wait... There isnt one!

Netflix really had no choice here, not only do they need to secure new deals to make their catalog larger, but their olds ones ith the major studios are ending.(in which they are essentially paying a small portion of what the studios are going to ask for this time around)

People outside of the US should also be rejoicing, as seperating the streaming service from the DVD service all but guarentees more content coming to other countries as they will not have to worry as much about DVD licensing in other countries.

I personally don't use netflix because pretty much all I watch is HBO.. and sports, but I do see the value for many people.

My guess is this is merely a tiny blip for Netflix, come Q4 their userbase will begin to increase again as they expand into more markets and start offering more content.

As for Starz? Seems a little bit of an overreaction considering it accounts for less than %10 of its current viewship, which will no doubt be replaced by other contracts by the time February rolls around.

RE: Seriously...
By SilthDraeth on 9/16/2011 2:09:36 AM , Rating: 2
My guess is Amazon Prime will be taking a lot of Netflix customers. I used to do Netflix, now I do prime. Even though the video selection is smaller at the moment, I have no doubt that it will grow substantially.

Plus prime is only $80 a year, free two day shipping, and $3.99 one day.

So yea, that is where my money is going now.

RE: Seriously...
By Reclaimer77 on 9/16/11, Rating: 0
RE: Seriously...
By Denithor on 9/16/2011 12:02:04 PM , Rating: 2
You're totally oblivious aren't you?

Prime is their shipping program, they threw in free streaming videos as an added bonus.

RE: Seriously...
By retrospooty on 9/15/2011 6:05:41 PM , Rating: 2
"it is good that Netflix found a sucker to keep paying for lousy content in the meantime."

Sounds more like they found 22 million and a few bitter people like you cant handle it. They arent all suckers and they are all free to cancel at any time. Free country...

It depends on your use. I have been watching whole series on it and get way more use out of it than my $10 monthly pays for. Breaking bad, Nip Tuck, Dexter, Enterprise, all sorts of good series on there that I missed when on TV. When it dries up, I will cancel or put it on hold. No worries at all.

RE: Seriously...
By Dr of crap on 9/16/2011 8:48:12 AM , Rating: 1
While what you say I for the most part agree, what happens when they don't have anything new to watch???

That's my biggest bitch. There doesn't seem to be anything new being added streming wise. Yes they have these movies no one has heard of, and I don't want to see.

If that continues, there will be more leaving.

RE: Seriously...
By cruisin3style on 9/15/2011 7:21:37 PM , Rating: 3
i don't think paying $8 for something that would literally let you stream tv and movies for a month straight if you wanted makes you a sucker if it's stuff you like

I only have netflix streaming because i got in on a crazy deal for cheap access, but there are a lot of good tv shows on there and decent documentaries if that is your thing

RE: Seriously...
By rikulus on 9/15/2011 2:21:26 PM , Rating: 3
I TOTALLY agree, I dropped streaming and stuck with a disc plan with Blu-ray. I think someone else here described it well: if you are willing to just watch any movie, the Netflix streaming selection is plenty big enough to find a random flick that will satisfy (although if you want one that's in HD the list thins, and one that's in surround sound even more so.) But if you have an idea what movie you want to watch, good luck actually finding it streaming.

I have 70 movies in my disc queue, 10 of them can be streamed (none in HD, and mostly at the bottom of my list.) I don't have time for a movie every day, so when I do watch one I'd rather it's something I've looked forward to watching and Blu-ray. I don't mind waiting for new releases to finally be available, and Netflix is still a good value compared to buying discs or going to the lousy theaters nearby.

RE: Seriously...
By SiliconJon on 9/15/11, Rating: 0
RE: Seriously...
By Reclaimer77 on 9/15/2011 3:16:08 PM , Rating: 5
they still didn't improve the selection.

Wtf, they CAN'T! Holy shit, do you think they have BILLIONS sitting in the bank? The fucking content providers have Netflix by the balls. Hell they offered Starz OVER 300 million dollars and it still wasn't enough.

Netflix would love to provide us with all the content we can eat, the problem is the bloodsucking content providers want to snuff Netflix out so we'll all be forced back to watching cable-fucking-TV for the rest of our lives!

You people complain about Netflix raising prices a few dollars then complain when there isn't enough content. Open your fucking eyes! It costs lots and lots of money to buy the rights to content, money that has to come out of profits.

I'm sorry for the language by my god you people piss me off sometimes. It's like you're totally oblivious to this issue and how the world works.

RE: Seriously...
By mcnabney on 9/15/2011 4:21:39 PM , Rating: 2
They didn't raise prices by a couple bucks. It could be up to a 60% price hike with no new benefit. In fact, by losing Starz the consumer will actually get much LESS.

And the deal with Starz was not about the contract, it was about setting Starz up as a premium add-on, like HBO or Showtime on cable. It wasn't about licensing. Netflix can still go directly to Disney and Sony to get the exact same content.

Currently, only cheap-to-license crap is on streaming. Which is great if you want to watch X-files re-runs, but lousy if you like movies released in the last two years.

The most popular movies of 2010 are NOT streaming:
The Social Network
Black Swan
The King's Speech
Tron: Legacy
Deathly Hallows part 1

It does stream Iron Man 2, and Tangled until February

RE: Seriously...
By cjohnson2136 on 9/15/2011 4:32:52 PM , Rating: 2
It's still under 20 bucks. I like the streaming for the old stuff and i get the dvds for the new stuff.

RE: Seriously...
By Reclaimer77 on 9/15/11, Rating: 0
RE: Seriously...
By Reclaimer77 on 9/15/11, Rating: -1
RE: Seriously...
By Dr of crap on 9/16/2011 8:54:21 AM , Rating: 2
Everyone has their own likes and dislikes. I don't care one bit if a move has won an award or not. I'll see it if it interests me.
So don't try and tell me if YOU like a show or movie.
I care not.
It's all subjective to the person watching.
I for one would not watch Arrested Development.

And after you watch this will there be anything new?
That's the question.

RE: Seriously...
By rburnham on 9/16/2011 9:27:11 AM , Rating: 2
Way to veer completely off topic.

RE: Seriously...
By bubbastrangelove on 9/16/2011 10:10:00 AM , Rating: 1
Haven't seen the other but there's about half a million people that disagree with you on "Black Swan". Go do Jägermeister bombs, keg stands and fist pumps with Michael Bay over Transformers III. That movie was great.

RE: Seriously...
By Bonesdad on 9/15/2011 5:17:10 PM , Rating: 1
dropped you back to 1. I agree with you for the most part, but your language is ugly and unnecessary.

RE: Seriously...
By NullSubroutine on 9/15/2011 5:30:14 PM , Rating: 2
You both know that when you comment you lose your rating, right?

RE: Seriously...
By wiz220 on 9/15/2011 4:29:29 PM , Rating: 3
I'll put ya back to 2, twas a good rant.

RE: Seriously...
By JohnWPB on 9/15/2011 5:40:47 PM , Rating: 2
Reclaimer77, I've been here on dailytech for quite a while now, but just recently registered. I sure with I knew how to raise the rating on your post, as I feel the exact way.

For all those that think Netflix is a ripoff, just go to Comcast and pay for their premium movie packages, and see how much you end up paying!

Plus they carry the same movies over and over for the next month.

Netflix might not be cheap, but it's a HECK OF A LOT cheaper than Starz, HBO, and all the rest!

RE: Seriously...
By ClownPuncher on 9/15/2011 6:27:58 PM , Rating: 2
Netflix is only cheap if you use it as much as you can. If you've been a member for years and can't find anything new to watch, $10 a month at RedBox is cheaper.

RE: Seriously...
By Reclaimer77 on 9/15/2011 7:43:41 PM , Rating: 3
Yeah and for only $80+ a month on cable TV you can catch the new "Dancing With the Stars" or HBO's endless reruns of movies!


RE: Seriously...
By Icebain on 9/16/2011 6:28:22 AM , Rating: 3
Don't forget Jersey Shore....the epitome example of the degradation of our society.

RE: Seriously...
By Dr of crap on 9/16/2011 8:55:53 AM , Rating: 2
DWTS is FREE over the air!

RE: Seriously...
By ClownPuncher on 9/16/2011 6:01:23 PM , Rating: 2
Why would you pay for cable TV? Outmoded concept. The argument that there is only Netflix or $80 month cable TV is ludicrous.

RE: Seriously...
By Hiawa23 on 9/15/2011 2:39:20 PM , Rating: 3
I had the 2 out DVD/bluray, plus streamin, before the hike which was $17.99. My rate would increase to $23.98, so I canceled the streamin portion as if I want to see any of the movies I will just rent the disc copy, so my monthly fee is $14.99. I rarely used streamin, & if Netflix wants us to get us off the physical copy rental then make it so all movies, new release included, & old are available & in HD.

I really did not care much for the Starz content, so I am fine with Bluray/DVD rental only. The movies get to me the next day, & with fast return, I can easily go through 6 movies a week, so mulitply that by 4 weeks a month, no car wear & tear, Netflix is still the best service for me.

In this tough economy, I guess Netflix thought everyone would just blindly pay & be happy. Guess not..

RE: Seriously...
By Flunk on 9/15/2011 2:39:42 PM , Rating: 2
I tried out NetFlix streaming a while back, the service is great and the quality is great. The content on the other hand is severely lacking. It's great to have access all the time from my console, phone and PC but if the shows suck I don't see a point at all.

RE: Seriously...
By Reclaimer77 on 9/15/2011 3:09:30 PM , Rating: 5
I really don't understand the Netflix hate on DailyTech. Can someone please explain this to me? I really honestly don't get it.

I was paying like $80 a month for cable TV, and the rates seem to go up like every year or so. Netflix saves me a ton of money, is more convenient, and I don't need a DVR to ensure I can watch what I want. Yes, it's true, Netflix doesn't have EVERYTHING IN THE WORLD available that's ever been put on video tape. Well I'm sorry, but that's just life. Netflix isn't Burger King, you can't have it your way all the time.

Those projections aren't even a million off, the author is making it seem like a collapse has taken place. 21.8 million people see the value of Netflix's streaming catalog, and I'm one of them. I'm very happy with Netflix, for less than $20 a month you would have to be an idiot to NOT be pleased.

So please help me out and explain to me what's so terrible about Netflix all of a sudden. Is everyone just getting wrapped up in Mick's typical biased sensationalized tone, or are people just THAT cynical? And if Netflix's streaming catalog is so poor, please point me to someone who offers a better service for the money.

RE: Seriously...
By TakinYourPoints on 9/15/2011 5:19:33 PM , Rating: 2
Sensationalistic editorial bias and DT go hand in hand

RE: Seriously...
By Hakuryu on 9/15/2011 5:40:39 PM , Rating: 2
People just love to complain.

When I first started Netflix, I honestly couldn't figure out how they could offer the service for $8. I can easily watch 30 movies a month, some very old and not popular films that would cost $2.99 each for one night of viewing On Demand (Time Warner).

So I figured a price increase was due, and if they do actually expand the instant viewing, then that increase would be well worth it. Dollar for dollar, Netflix is still incredibly cheap compared to anything.

RE: Seriously...
By JohnWPB on 9/15/2011 5:49:02 PM , Rating: 2
To use your word "Seriously", I agree 100%. If we were to lose Netflix, my wife might seriously lose me.

RE: Seriously...
By fredgiblet on 9/15/2011 7:10:26 PM , Rating: 5
I really don't understand the Netflix hate on DailyTech. Can someone please explain this to me? I really honestly don't get it.

Insane levels of entitlement.

RE: Seriously...
By room200 on 9/15/2011 9:11:45 PM , Rating: 2
I find you confusing; YOU are one of the main posters here who always says things like "vote with your dollars", "go elsewhere if you don't like it". This is what people like me have done, and THAT pisses you off? or have I misread you. No bitching, no moaning; I just cancelled and haven't looked back and I don't miss Netflix. I didn't think it was worth the price increase, so I cancelled. Netflix doesn't own me, and I'm TRULY not concerned about their licensing fees. That's for them and their providers to work out. When I'm paying my bills, I certainly don't think Netflix is saying "You know, it's a probably not a good idea to raise prices in this economy; it hurts consumers."

The providers aren't stupid and they know that no other Netflix type service is available; they have to sell to someone. It's not about Netflix not making money; they have decided they want to make much BIGGER money, and decided to pass the cost on to me. Idecided I didn't want to play the game. No hate. No arguments. No harm. No foul.

RE: Seriously...
By nycromes on 9/15/2011 10:15:55 PM , Rating: 2
Well, I can understand if you were replacing your TV/Cable service with netflix, its a great deal. I on the other hand cannot replace my TV service with netflix (it wouldn't go over well in my house) so I'm paying for both. I didn't mind paying the pre-increase prices, but now, I just can't quite justify paying more for the same or less content in the near future.

Netflix really went about this in the wrong way in my opinion. They wanted to force people to stream by increasing prices at the same time as ISPs are capping connections. Not to mention the Starz thing, yeah, they really did get the short end of the stick. I wouldn't have minded a few dollars more, but my bill almost doubled. Bottom line, Netflix is cheap TV if it is now your primary delivery method, but for those who still have other TV service in their house, its an unnecessary expense. Gradual price increases would have helped, more content would have helped with the price increase, but what users got was a higher price with no real difference in service. You tell me why there is so much hate.

RE: Seriously...
By wempa on 9/16/2011 1:08:23 PM , Rating: 2
Excellent post. No need for people to start criticizing/insulting others. I don't currently subscribe to Netflix, but I could definitely see the value of Netflix only or Netflix plus a very basic TV package. Ideally, I'd eventually like to go to a Netflix-type service plus just an antenna for over-the-air TV. I just don't see the value of these big cable TV packages where 90% of the channels carry junk. You're also right about the timing of the price increase. It would be a different story if they combined the increased cost with better content. I'm sure a lot of people wouldn't even mind paying double the cost if the streaming content was greatly improved.

RE: Seriously...
By inperfectdarkness on 9/15/2011 7:48:09 PM , Rating: 2
i'm ok with the i tend to watch TV shows. problem is, price hike + losing DVD's + losing ability to use more than 1 simultaneous stream = BIG FAIL.

i don't want to be blocked from watching south-park because my wife is watching CSI in the other room. if anything, you'd think they could have made an exception for PC access vs. game console access; allowing one of each per subscriber account.

i'm VERY, VERY close to cancelling netflix altogether & just giving myself wholly to the dark-side (god bless you tor). MPAA has only their greed to blame for that.

RE: Seriously...
By Dr of crap on 9/16/2011 9:02:05 AM , Rating: 2
You CAN stream more than ONE screen to your plan. I think the final word I heard was -
streaming only 2 screes
1 DVD out - 2 screens
2 DVD out 3 screens


Not as dire as the stock shows
By AssBall on 9/15/2011 2:02:20 PM , Rating: 2
22 million instant viewers is still 172 million income per month with ONLY licensing and servers as overhead.

That seems like a pretty good deal to me. I think their stock will rebound fine.

On a personal note, We dropped our DVD plan when they changed the pricing structure.

RE: Not as dire as the stock shows
By invidious on 9/15/2011 2:54:12 PM , Rating: 2
customer service, market research, advertising, lawyers?

RE: Not as dire as the stock shows
By Chernobyl68 on 9/15/2011 3:12:24 PM , Rating: 2

RE: Not as dire as the stock shows
By AssBall on 9/15/2011 4:17:51 PM , Rating: 2
An IT staff that makes 172 million a month to make sure the servers and network are up? Sounds awesome.

RE: Not as dire as the stock shows
By mcnabney on 9/15/2011 4:06:23 PM , Rating: 2
I am dropping the streaming portion instead.

24 items in my queue and only one can be streamed

Sure, there are always things to watch on streaming, but they only get what is CHEAP so they are unlikely to have what you WANT to watch.

By omnicronx on 9/15/2011 4:47:25 PM , Rating: 2
with ONLY licensing
You mean.. the most costly portion of their entire business?

One in a million
By jeepga on 9/15/2011 1:41:22 PM , Rating: 2
I'm happy to be one in the million. I haven't missed the service a bit.

RE: One in a million
By AMDftw on 9/15/2011 2:22:04 PM , Rating: 2
agreed. My parents, grand parents, uncle and I turned off the service after this little idea of theirs. I went back to streaming new releases.

RE: One in a million
By bitterman0 on 9/15/2011 2:31:28 PM , Rating: 2
Same here.

While presently it doesn't hurt Netflix in any way (the loss from 1M customer base shrink is much less than 60% service price increase), I think that people should exercise their wallet voting rights more often.

It's just that many got used to cable TV operators year after year rising subscription fees without rhyme or reason, a small (in absolute dollar value, not the ratio) increase in price from Netflix does not even register as a noteworthy event. Oh well. Perhaps, when Netflix ends up charging $100 for their monthly subscription after a couple-three years of steady price increases, people will notice.

RE: One in a million
By gmanthebrave on 9/28/2011 12:59:06 PM , Rating: 2
I look forward to when streaming is offered to non-DISH customers because then the media will really have something to talk about. Netflix’s folly is DISH Network’s gain and only time is needed to build the capitol in Blockbuster for the right positioning. Right now I’m benefiting having an employee 722 receiver because the streaming for the Blockbuster Movie Pass will be right to my receiver starting October 1st.

Question and Comment
By JohnWPB on 9/15/2011 6:39:55 PM , Rating: 2
First of all, I asked this question in an earlier post, but no one answered it.

How do I raise or lower the rating on a post? I see lots of times that I agree with a viewpoint someone has posted, and have wanted to raise the rating on their post, but I am at a loss on how to do that.

As for those who say there is nothing to view with the streaming package. I found a very useful tool that lets me know what new ones are coming up, and which are about to be taken OFF of the streaming package. The URL is

A handy little tool to use.

RE: Question and Comment
By InsaneScientist on 9/16/2011 5:39:28 PM , Rating: 2
You can't Up/down-vote posts (Worth reading/Not Worth Reading Buttons) if you've commented.

When you first view an article (after logging in), there are 4 buttons at the bottom of every post:
Parent | Reply | Worth Reading (If the post isn't already rated 5) | Not Worth Reading (If the post isn't already rated -1

Once you comment, the latter two options go away for that article.

Just discs for me
By LBID on 9/15/2011 3:10:55 PM , Rating: 2
I've canceled the streaming part of my subscription, there just wasn't enough compelling content there for me. Sure I'll miss watching old episodes of Highlander, but I think I'll survive.

What are the real losses?
By mac2j on 9/16/2011 12:55:21 AM , Rating: 2
I put my account "On Hold" just in case they change their minds - which I know many others did also. That means they'll have a swarm of additional cancellations hitting when the 3mo max Hold period ends.

Also I wonder how much they've lost from people downgrading their subscriptions. When you factor in the totally inflated Blu-Ray add-on cost, I bet a massive amount of subscribers dropped from 2 and 3 to 0 to 1 disk plans and from Blu-ray plans to DVD plans.

so who's next?
By mjnoir1 on 9/18/2011 12:48:58 PM , Rating: 2
I wasn't happy about the price hike at first but knowing what I know about the studios and content providers I could understand why the hike happend. Now the question is when are the studios going to make their own netflix alternative? or is it more profitable for them to stay out of that business?

I personally stayed at the streaming service only I agree with many of the complaints their movie selection isn't very good when it comes to new titles but their back catalog is much better and the tv section is quite good i'm always finding something new to watch.

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