Home » Consumer News »Online Video » Currently Reading:

Netflix Raises Prices for Unlimited Streaming + DVD-by-Mail Service

Phillip Dampier July 12, 2011 Consumer News, Online Video 22 Comments

Netflix has dramatically raised prices for their customers who subscribe to both unlimited streaming and renting DVDs-by-mail, several months after their last rate increase.

The company today announced it was unbundling discounts for its plans that include both online video streaming and DVD rentals-by-mail.  Under the old pricing, customers could watch an unlimited amount on online content and still get one DVD at a time mailed to them for $9.99 per month.  Effective today, that same plan will cost $15.98 — a $6 monthly increase.

According to Netflix’s Jessie Becker, the company is effectively pushing customers through pricing to either renting all of their DVD’s by mail or going with unlimited streaming.  Doing both will carry a significantly higher price.

“We are separating unlimited DVDs by mail and unlimited streaming into separate plans to better reflect the costs of each and to give our members a choice: a streaming only plan, a DVD only plan or the option to subscribe to both,” Becker writes on Netflix’s blog. “With this change, we will no longer offer a plan that includes both unlimited streaming and DVDs by mail.”

That’s not exactly true, however.  Netflix is still selling combined plans, just at substantially higher prices.  A three-DVD-by-mail plan that includes unlimited streaming used to cost $19.99 a month, but will now be priced at $23.98 a month, a four dollar increase.

The new pricing does not include the very steep price increases forecast by Wall Street for unlimited streaming.  Content creators, especially large Hollywood studios, expect to aggressively negotiate for dramatically higher fees to renew contracts for Netflix video streaming rights.  Most anticipate Netflix will need to raise streaming prices to cover those costs in the near future.

Customer reaction?  Overwhelmingly hostile, with many threatening to cancel service in favor of Amazo, Hulu, or even Redbox.

Among the comments:

This is a 60% price increase. Netflix sure has some audacity to think they can get away with a 60% price increase in this economy. I currently have the $9.99 one-DVD plus streaming plan. Sept 1st I will have to pay $15.99 ? Not gonna happen. I’ll cancel one or both services. There are other options (I have Tivo, Apple TV, Amazon Prime, etc.) Netflix has peaked. They are going to blow it.

You can spin this any way you want, Netflix, but it comes down to simple greed. With limited new content on your streaming service, I will be definitely be canceling that and will probably cancel DVD service as well just on principle. Time to sign up for Hulu Plus! Go ahead and change your name to Blockbuster, because with more stupid decisions like this, it’s only a matter of time before you go by the wayside like they did.

60% increase, practically overnight, to get the same service I get now? That sucks. If I rented more than one or two DVDs a month, it might be worth it, but I only use the DVDs as a fallback when the movie I want isn’t on streaming, and they often take several days to arrive. If you had your entire catalogue on demand, then I could pick between two options, but you’re forcing me (and a lot of other customers) to pay full price for both in the hope of getting one complete service. You already increased prices at the beginning of the year, and this kind of hike six months later is unacceptable. Hulu is starting to look very good.

Congratulations. You’ll probably be losing our household subscription. We’re long-time members (since 2002) on the Unlimited 3-disc plan. We just started streaming more because we finally have a game system set up in the living room. However, with these “changes” we’ll no longer be able to afford both. So why bother to keep either? Thanks, a lot, Netflix. I really bloody hate you. And that’s sad because until this year, I didn’t have many complaints about your company. Why the hell can’t you just leave things as they are? If things aren’t broken, don’t fix them. :(

The only way I will be sticking with Netflix then is if they offer newer titles and ALL titles in just streaming. Because I’m not paying 15.98 for what I get now at 9.99. This doesn’t make sense. THe only reason I signed up is because I thought “9.99 a month. I can do that.” but 15.98 a month with my minimum wage job, having to pay for college, gas, insurance, cell phone. I’m not adding an un-needed 15.98 a MONTH netflix bill. Count me out.

So, my 2-at-a-time with streaming and Blu-ray plan currently costs $17.99 (up from $16.99 last year and $13.99 when I first joined in 2008). Under this new scheme, I get no new features or services, but I have to pay $22.98? Um, no thanks… I think I’ve had enough.

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.  You guys have really messed up here.

Share

Currently there are 22 comments on this Article:

  1. Navil says:

    Yea, I won’t be paying for both. Probably drop DVD, but if they keep raising it there will be a sudden slowdown in Netflix’s growth in my neighborhood.

    Too bad, it was a good service at a good price. I guess movie studio greed had to overcome them eventually.

  2. Karl says:

    Just set a reminder on my calendar for Sept. 1st to cancel Netflix. I don’t think their price increase will last long. I suspect that a large percentage of their customer base is very price-sensitive (and thus will not put up with a 60% price increase).

    Also, Amazon prime is cheaper (at $79/year vs 95.88/yr) and includes shipping from Amazon along with streaming movies.

    Why does Netflix want to go out of business??

  3. Kevin says:

    I bet we will “miraculously” see the missing Sony content come back now. I smell a rat here and think that in order to cover the increased programming content costs Netflix had to maybe do this. Which makes me shudder to think what will occur when all the studios renegotiate licensing with Netflix.

    Their wet dream is for consumers to pay about $80-100 a month for quality HD television and movie programming. Whether you get that via cable tv, satellite tv, or streaming the big studios dont care. “Just dont you go cutting your high priced cable and expect to get to watch all our shit online for $15-30 a month! (hulu + Netflix)! NO sir! If those consumers are willing to pony up $80 a month for their TV so should your internet nerds with your streaming!!” *sigh* thats how I see this playing out. :(

  4. Josh says:

    I’m fine with it. It was bound to happen at some point, and I can’t blame Netflix. They’ve given me years of great service and I’ll stay loyal.

  5. George says:

    this is total BS!!…they say that they’re trying to get people to either subscribe to DVD’s by mail OR to go totally steam-based renting??…then why is it that ALOT of the better movies that you CAN get through the mail do not show up available online??….i’m dropping my one-WHOLE dvd in the mail portion but if they keep raising the prices, i’ll just end my subscription altogether!!

  6. Joshua says:

    I stopped paying for Netflix some time last year. I don’t see it worth paying even 5 dollars per month since they since don’t care to update the instant streaming fast enough. I don’t care to see the same movie in my new releases for 2 months, let alone a month. I should not see the same movie there after a week. I am angry by Netflix’s increase and divide plans even though I don’t have anymore because people are still wiling to pay for the below respectful service Netflix offers.

  7. will says:

    It isn’t greed, their contracts for streaming movies are up at the end of this year and the big studios are jacking their rates, simply because they can now with Google and others with deeper pockets competing against Netflix. Netflix doesn’t have a choice.

    I don’t like it, and I will probably reduce my service, but I DO understand the position Netflix is in.

    Joshua: Netflix doesn’t update their streaming catalog as fast because the studios will not let them have that content as fast. The studios think that you will be impatient and buy the DVD first, so they hold it back from netflix to make more $$ off of you.

    • I agree that Netflix is being punished by programmer greed, but that should be reflected in the online streaming service price, not the DVD rental price. DVD rental contracts remain pretty stable. Netflix got special discounts for streaming to see how the service would do. It did very well, so now everyone wants a piece.

      Somehow I think the disparity won’t last and we’ll also see a huge rate increase for streaming by the end of the year.

  8. Scott says:

    I already saw the blog today and immediately went in to vote with my $$, dropped Streaming as the selection is horrible and sub par without full licensing rights from the major media companies.

    I’m now set to use the 2 DVD out at a time plan only which saved me $5/mo (or cost Netflix $5/mo) and I’ll probably cancel that eventually as it’s starting to get more economical to rent locally when I can get 3 DVD’s or Blu-ray’s for just $8 at my local store without waiting 3-4 days. For people that have a RedBox available it’s an even better deal to go with that.

    I’ve checked my history and on a 1 DVD at a time plan I was never able to get more than 4 DVD’s a month, same for 2 DVD plan I could only get 8-9 DVD’s a month and that was with watching them immediately and mailing them right back the next morning.

    IF Netflix had secured rights to stream their entire collection of DVD’s as other people have said, I’d be more than happy to pay more – $15/mo, whatever.. but they don’t, and they have no immediately plans or deals in place to do that.

    They’ve seriously jumped the gun here in trying to PUSH people to only Stream so they could save money on their mail-order side when people have NEEDED the mail-order DVD service to supplement the weak streaming selection. For most people like me, I’ll try to watch through a season of shows but find it’s missing 2-3 seasons that are only on DVD… hence needing the DVD subscription to finish watching the series.

    They could have avoided all this by just waiting until they could wrap up some negotiations with the Studios to fill out their streaming selection significantlly thus providing value for the increased price they want to charge, but they didn’t..

  9. Martha says:

    This makes no sense! Not every movie is available through streaming, so you have to have both or limit what you watch. We are currently watching Heroes and we are coming up on two episodes that aren’t available on streaming. So I guess we have to watch those soon! Definitely will look into Hulu Plus and other streaming options.

  10. Financial Consultant says:

    Love netflix. The price is just right. Don’t know about increasing it.

  11. I think it’s a safe bet whenever programming gets restricted or becomes excessively expensive, people will just go back to torrent or Rapidshare and steal it.

    That’s why piracy remains an industry-made problem. Make programming available at a reasonable price and easy to obtain and people will use the legal services. Restrict episodes of shows or make others unavailable and people will hunt down “free copies.”

    As for Netflix, I coincidentally dropped my $9.99 1-out plan to stream-only last night before even realizing this price change was coming. I had run out of things to rent on DVD that I cared about, mostly using DVD-mailings to fill in gaps in episodes of shows not available for streaming or for obscure shows I couldn’t see any other way.

    I won’t go back to renting DVD’s at today’s new prices.

    • Scott says:

      This is what I don’t get about the Movie Studios and programming executives.. they’re leaving incredible amounts of incremental revenue on the table that they could be earning with cheaper options.

      Many of us as consumers no longer subscribe to overpriced Satellite service, cable TV, nor do we go to the movies that cost even more with “3D”, and who buys $20-30 DVD’s anymore?

      If they embraced the iTunes App model of capturing the massive demand for media/entertainment are bite sized pricing they could acrue a huge volume of sales.

      Apple nearly killed off music piracy by dominating the mp3 trade with inexpensive singles that were only a click away to purchase for less than a dollar.

      Yet here we still are with overpriced video services and downloads or one-time streaming that don’t meet the needs of today’s consumers.

    • me says:

      Thing is they probably could have incrementally got there just like the cable industry. Instead they just yanked the bandaid off. Come Sep 1 it will probably be gone from this house.

  12. Areti says:

    No thanks. Even if it’s JUST 6bucks a month IT IS THE PRINCIPLE. I wont stand idly by while they try to sneak these prices up on us. I can find everything else on the internet.

  13. jordan says:

    If you people dumped Poopflix and went back to going to Videostores you would get your new release on day it is released.Not only that but you will help out the place you live in by keeping local commerce going.And you will also keep unemployement in your area down by shopping locally.

    PS Poopflix cost me the job I have had for 18 years so I do hate their way of life.They are just like the bigbox Mall Stores that come to yuor town and kill off all the great little mom and pop stoires that existed for years and can not compete witht eh buying power of the Mall.

    Buy Local and help out your community.

    • Ron Dafoe says:

      If the local video stores would set up a reasonably monthly plan where I pay x amount of money for unlimited rentals, then I would. Sorry, but the days of $5 for 2 days and if you bring it back late you might as well have purchased the DVD are gone.

      If they want to survive, they should have plans similiar to netflix – $15 – 20 a month for 1 or 2 dvds out at a time. I would then support my local store.

  14. Doug says:

    I have been a NetFlix member for awhile now and the first increase caught my eye but I overlooked it and paid the new rate…however this is a dramatic increase that simply can’t be overlooked. I went from $7.99 to $9.99 and now I’m looking at $15.98…nope, sorry NetFlix but you can expect me to cancel before September 1st!! Everyone needs to band together and cancel and show NetFlix that we won’t put up with price increases like this. Let NetFlix lose 60% of their customers and see how they like it!!!

  15. Ron Dafoe says:

    This is making me rethink my netflix subscription. Their announced profits rose 88% as reported at the end of April 2011. Not having a bundle makes no sense. I don’t really care that they have to raise their rates, and would pay $10 to 12 a month for just for streaming if I did not need to suppliment (by alot) my streaming with DVDs. A $8 dvd only plan and a $12 bundle plan would be a price point that I think would be good.

  16. GlennAllen says:

    This change affects me not at all. I’m streaming-only and have no interest in DVD rental–by mail or otherwise. I really wish Netflix would/could offer everything they have via streaming, even at double the current price; but they can’t buy what the “content owners” won’t sell (at an even close to reasonable price). DVD renters have been getting a “free ride” on the Netflix streaming train for years now; so it’s over… BFD–they’ll have to start paying what it’s worth to support streaming (I mean, that’s “fair”, right?). Hosting content costs considerably more than renting out DVDs–needing systems and bandwidth to support it as well as the licensing to host and distribute it; and the content owners are going to see to it that those costs only increase. It’s still a bargain with the new change. But what with Hollywood and the rest of those “programmer” thieves getting their grubby hands more and more into the mix, it won’t be long before I abandon all hope of seeing much of anything worth seeing via some online delivery method at a reasonable and acceptable price… at which point I’ll just drop the service–because I really don’t want to give any more money to the thieves in Hollywood.

    • Chuck says:

      Netflix will loose many customers due to this unnecessay hugh increase, over 60%. This doesn’t include the tax we pay on top of the charge.

      I cancelled immediately after receiving their email. I tried calling to discuss what justifies this large increase, but could not get through all day. In fact, the operator stated that due to a large number of calls to call back later. No thank you, etc. Just hung up. Very rude.

      On another site, their poll shows that 17% of subscribers have already cancelled, and 55% may do so if they do not change their mind by September 1st. Why give them the extra income until then. There are many other options out there that are now much better than Netflix.

Search This Site:

Contributions:

Recent Comments:

  • Toby: A Comcast guy going around my neighborhood knocking on doors offered me the preferred plus Triple Play with 105 Mbps for $89.99/month. After addition...
  • Carmine: Hi, My contract is up Oct 10th. AT&T wants to increase my Uverse and I-net (6MPS) by 34%. Today I just used your strategy and called the 800-288...
  • Tony: As frustrating as it is, I can tell you from our experience it is the cable company For us the tuning adapter's firmware was not up to date. Cur...
  • Vikki Karan: Count me in!! I'm willing to take this cause on as well! Willing to take it all the way to DC and/or file a class action suit. Here is my story: ...
  • RG: I see the V52 on occasion with Cox in San Diego. Sometimes it's a SDV box decode error, other times it's a channel that I'm not subscribed to or doesn...
  • Vikki Karan: Major TWC issues with TiVo here in Los Angeles. We keep getting V52 errors. TWC says it is an issue with the TiVo Roamio. That there are open tickets ...
  • Scott: GCI just raised Cable TV rates and fees across the board an additional $30/mo for all customers this last month, so most that were paying $135 for a t...
  • Jim Livermore: After all of the detail in the above article, your sole comment is a critique of my first sentence? Thank you, Anonymous Coward....
  • MadBomber: >While extortion might be a little strong... What do you call forcing a payment without proof of guilt then?...
  • Phillip Dampier: Hi, I was unable to get permission to share the report, but in response to your inquiry, I can share their reply that they are using "cash flow margin...
  • Theresa Bailey: Either Mr. Doda is lying, or there is a lack of consistency in following procedure among the Bright House representatives. When I signed up for B...
  • Jim Livermore: Another great report, Phillip. While extortion might be a little strong, it is a response to the 6-strike noise by a third party offering a middleman...

Your Account: