Thousands of Netflix users have had nasty surprise recently, with the news that they will have to pay up to 60% more to continue to enjoy the service they are already getting. With this in mind is there a future for DVD rentals following Netflix’s change in pricing?
In a move which has caused outrage for users but cheer to movie studio executives. Netflix will no longer offer the plan which lets subscribers have access to an unlimited amount of online movies as well as renting one DVD at a time for $9.99, according to an article on the Los Angeles Times.
Now subscribers will who still want the same level of service will have to pay $15.98 per month instead. There are now two services with Netflix Instant streaming costing $7.99, and to rent DVDs is also $7.99. The new charges start straight away for new customers, while existing subscribers have until September before the new charges start.
It is estimated that around eighty percent of Netflix’s 22.8 million US subscribers currently use the DVD/streaming plan. Obviously this news hasn’t gone down to well with subscribers with over 10,000 posting on the Netflix Facebook page, and most replies were not positive.
In reply Netflix’s Andy Rendich said the new prices “better reflect the underlying costs“, and gave better value for money for those people only wanting DVDs. More details of the reasons behind the pricing change were promised later this month as the company reports its financial results. Some point to the higher cost to the company for providing content to be streamed.
If customers who switch to a cheaper plan will then have access to less content, or pay more for what they are already receiving. These higher prices will please those who thought the service undervalued the studios content. Four studios currently prevent Netflix from releasing new DVDs until 28 days after they go on sale in retail stores.
The cost of postage for DVD rentals will be another factor with the new pricing, but will it mean that DVD rentals will eventually tail off? More devices in our homes are becoming internet ready which will allow easier download of content n the future. The plight of Blockbuster has been much publicized as less people watched films in this way.
But the since it was taken over by the Dish Network prices have come down, and is working on a streaming service. There are also the Redbox kiosks which offer rentals for $1 per night. Will you be canceling your Netflix subscription?
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