Has Netflix Screwed the Pooch?


If you’re a Netflix customer you might have caught today’s announcement of new plans and pricing (starting now for new customers and September 1st for existing customers). Netflix has announced that they will be splitting their plans into two separate types: streaming andDVD. 

It’s not an unexpected move, though the lack of incentive for current members to stay on at their current plans isn’t much. Under the current plan structure you can have both unlimited streaming and unlimited DVDs (limited to so many discs out at a time) for a bundled price. It’s a good deal as some folks don’t watch many DVDs and prefer to stream what they can from the Netflix library. Others take plans that allow them to have up to 8 DVDs out at a time and still have the option for unlimited streaming. Me, I have a 4-discs-at-a-time plan with the streaming option. It works well for me as I often like to watch multiple discs on a weekend or one a night during the week when I have time.

With the new plans you can have unlimited streaming for one price and then you can add your DVDplan for a second price (yes, you’re essentially paying for two separate plans instead of one). The price increase varies based on what plan you’re currently on but all the costs will increase come September 1st. Those people who have been customers even just since last year have noted that this new pricing comes less than a year after the last price increase at the start of 2011.

I’ve been watching the Netflix Facebook update that links to the new blog. In 54 minutes they had over 2500 angry comments. It’s now been about two hours and that number has grown to nearly 4100. Their blog post has over 900 comments alone. Not a single response from Netflix folks so far.

The three biggest complaints about this new structure and pricing are these:

1. The streaming library doesn’t even compare to theDVDselection. Not enough things are available on streaming and often they are only available for a limited time. Some folks have been in the middle of a television series only to have the streaming option turned off before they can finish a series or season. More folks might be okay with the new pricing and plans if the streaming library duplicated their physical one and didn’t set “end” dates for streaming options.

2. No discounts for going with both a streaming andDVDoption. Most folks that I know prefer having both options. Heck, even I like having the streaming (even without a way to watch it on my TV yet) for when I can catch something before I get the disc. But I’m a huge fan of the actual DVDs and rotate out my 4 discs on a weekly basis. Most businesses often offer discounts or incentives for customers to bundles several service options together in order to entice them to spend more money. Not so for Netflix’s new option.

3. No discounts or incentives for current customers. Unless you count that current customers have until September 1st before they have to pay more or change their plan. When many companies change pricing plans they often let current customers retain their current plan and pricing indefinitely. Of course, any change to their options will often negate that and require them to adjust to the new pricing but that’s to be expected. In this case there is no such option being offered or even hinted at.

From the now 4300 unhappy comments on their Facebook post, it looks like Netflix stands to lose quite a few customers from this move. I’m extraordinarily curious to see how Netflix will respond to the customer reactions they are receiving. As of this writing I haven’t see any response from the company but I’ll be watching.

In the meantime I’ll be debating exactly how much I really like my own Netflix service and if it’s worth yet another price increase to me.