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Netflix is making two big changes to its plans and prices that will either prove to be successful, or rub subscribers the wrong way

On-demand video streaming and video rental-by-mail company Netflix has enjoyed bundles of success recently, reporting 23.6 million subscribers worldwide this year. But now, Netflix is making two big changes to its plans and prices that will either prove to be successful, or rub subscribers the wrong way.

The first new change is the introduction of DVD-only plans. Customers have the option of paying $7.99 for one DVD out at a time, or $11.99 for two DVD's out at a time, but the plan does not allow video streaming to be included.

The second new change is the separation of video streaming and DVD plans. While current plans bundle the two together for $9.99 per month, the new plans will be either DVD only or video streaming only. A DVD-only plan with one out at a time costs $7.99 per month, and a video streaming-only plan costs $7.99 per month. No longer can they be bundled together.

If a subscriber wants both plans, the monthly cost is $15.98 per month.

According to Netflix, the reason for these changes is to meet demand for DVD by mail, and the current $9.99 plan (which is $7.99 for streaming and an extra $2 for DVDs by mail) does not make sense financially. Netflix believes DVDs should not just be a $2 add-on cost, but a broader, individual plan of its own. Also, Netflix wants to ensure the long life of DVD by mail options.

These changes are effective immediately for new members, but for existing members, these changes are effective September 1, 2011.

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Too bad
By medavid16 on 7/12/2011 8:40:01 PM , Rating: 2
Was doing so well, too bad someone up there made a poor decision.

Obviously, they expect to lose some customers. But I think they will lose more than they think, look at this blog alone.

Let me add this up...

DVD/Blu Ray, Redbox vs Netflix
Redbox $1/$1.5 per movie, plus some driving / gas money / time / tax - roughly $1.34/$1.80

Netflix $9.99 divided unlimited per month (but restricted by how fast it gets to your house (so roughly every 4-5 days given that you have to RETURN the video too) Comes to about $2.18 per movie.

Streaming - different arena than I care about, but just read the posts, there are other better options.

My math isn't the greatest, and I'm generalizing and estimating, but I don't think it takes a genius to figure out this costs more than redbox.

RE: Too bad
By dayanth on 7/12/2011 10:20:21 PM , Rating: 2
It's how Netflix is going to survive the Movie companies next year when most of it's contracts end. Netflix is just anticipating the 10-fold increase in license fees it'll have to pay to the companies in order to keep serving it's customers.

I wouldn't be surprised if Redbox also did the same thing.

It's just sad that such an increase was bound to happen.

RE: Too bad
By JediJeb on 7/13/2011 11:25:46 AM , Rating: 3
This is what all the complainers here are not taking into account. The movie studios are finally seeing what kind of revenue stream they can get from the Netflix and RedBox type companies and are going to start milking them through their contracts to make up for their lower revenue from the box office lately. If people won't pay $7-$15 to see a movie in the theater or $15-$30 to buy the video when it is released, then why not make them pay it through their rental/streaming service.

I am putting my money on the greedy studios causing this more than a greedy Netflix. I noticed on July 1 that Netflix lost the rights to stream Babylon 5, which upset me since I was up to season 4 and didn't get it finished before it was cut off.

RE: Too bad
By mcnabney on 7/13/2011 1:04:12 PM , Rating: 2
Other way around.

Studios are competing against each other and GIVING Netflix money to offer/advertise their content. In addition, they are paying Netflix a ton of money to delay their release by 4-6 weeks to encourage DVD retail sales.

RE: Too bad
By Reclaimer77 on 7/13/11, Rating: -1
RE: Too bad
By Hiawa23 on 7/15/2011 10:35:15 AM , Rating: 2
So let's use your math for my case & compare Redbox to Netflix. I go through 4-5 bluray/DVD mailed to me per week. Let's just use 5 cause I have the 2 out at a time plan & most weeks it's 6 mailed movies to me/weekly. I am paying Netflix $17.99/month for bluray/DVD, plus unlimited streaming. If Redbox costs $1.50 per movie, plus I have to drive twice to the store twice, if you add up the amount of mailed movies I get per month from netflix which is about 20 for the $17.99/month, plus unlimited streaming, it would cost me $30 from Redbox, plus all the gas I would waste & wear & tear on my vehicle, so Netflix is still the cheapest if I compare it to Redbox.

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