Ouch. In spite of a rather cavalier attitude from the top down regarding the recent shake-up in Netflix pricing, a new report suggests that the company could hemorrhage more than two million customers before the dust settles.
A telephone poll conducted by research firm The Diffusion Group (TDG) found that between 12-15% of Netflix subscribers currently receiving the soon-to-be-extinct streaming/DVD combo will cancel their service within six months.
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TDG also found that 44% of the above group will keep their streaming plan while canceling the DVD option.
TDG founding partner Michael Greeson said the following about the report:
“This is a significant finding . . . It suggests that, at least among dual-service subscribers, preferences have tipped to favor video streaming over physical discs.
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This was a central assumption behind Netflix’s risky decision to change prices at this time in the game.”
Greeson also believes that Netflix customers who cancel their service in a huff may quickly find that the grass is not greener on the other side of the streaming fence:
“Once they see what alternatives exist in the marketplace, Netflix won’t look so bad,”
Do you think Greeson and his firm’s numbers will be proven right, Insiders? Are angry Netflix customers who cancel at least part of their service playing right into Reed Hastings’ hands? Will Netflix temporarily shed a few million customers only to return to explosive growth shortly thereafter?
(via Home Media Magazine)
I believe so, especially once they increase their streaming library, which is the whole reason behind doing this. I for one have not been a Netflix subscriber in the past, but plan on joining very soon just for the streaming service. I know several other people that are planning to do the same…
I know its off topic, but I didn’t know how to submit a news article…
“Fear of cord cutting behind Fox’s authentication plans”
http://www.reuters.com/article/2011/07/27/idUS172680059720110727
Fox shows will have 8-day delay for non-cable subscribers.
Just like the 28 day DVD window doesn’t affect me, neither does this 8 day window. I agree that most people are dropping cable not because of titles available online, but it’s just so expensive and that’s one of the first thing that gets cut when your budget demands cuts.
Not a big deal, really. A lot of networks already have a week delay. And if you look at most people’ DVRs, you’ll find they’re actually on a much longer self-imposed delay. (I end up letting three or four weeks’ worth of stuff build up before I watch it.)
FYI, Fox already does this and has been doing it for at least the last year. We have satellite, and even when we had cable, if I missed an episode of a show that I watched on Fox when it originally aired, the only way I could watch it was to go online after 8 days to see it or else wait until it aired during re-runs. Doesn’t really sound all that different from what they have already been doing, although thank you to the Insider for the update that it may change. This past year, I’ve actually sort of stopped watching that show on Fox since I’ve found other shows on other networks that were easier for me to follow without disrupting the storyline’s arc if I missed an episode. 8 days means that during the regular season, if you were able to watch a Fox show when it originally airs on tv, it would air before you could watch the episode you missed from the week before online, which, if you watched the live show, spoils some of the plot development from the previous episode. I tried a few times to catch up, but it was too much work, and ultimately not worth it. To have to add another layer to authenticate that you have cable and keep redoing that seems like another layer of unnecessary difficulty and no reason for them to collect such personal information. My viewership now goes to other networks.
I gave up Netflix due to the increase. They won’t see another dime from me unless their library of streaming titles gets better and fresher.
Amen to that!! I am cancelling as well. 75% increase in the last 8 months? Anyone else get that kind of raise this year? And for two half-baked services… one with limited selection, the other with LONG wait times for current/newer releases. And they want a 60% increase for this? Netflix can go eff themselves!!!! Tell their CEO I said that…. anyone that pays this… should also have their taxes raised. they can pay ALL the inflationary increases for the rest of us who have some sense left.
Greeson makes a good point — even with its problems (price increase, technical issues) — Netflix streaming offers a significant value. In terms of what it offers, there really isn’t a true competitor. I suppose this offers and opportunity for another company to step in, but they’d have to do some fast work to build a streaming library like Netflix’s.
That’s an estimate, and I would assume that is their worst case scenario of customer loss. They are saying 2 million knowing the chances are high it is less than that.
Then they can come back at the Q3 report and go “see we thought we would lose 2 million but we lost less than that” and their stock will go back up.
Most people are doing exactly what they want – dropping the DVD plan in favor of streaming and then going to redbox etc to get cheap new releases. You can rent two a week from redbox for the same price as netflix – probably more with their code deals.
Now… if people were dropping the streaming and going to a DVD only plan (like I have), netflix would be hurting pretty bad come time to renew their streaming contracts with the studios.
Doesn’t Netflix have a 10-15% annual churn anyway?
I dropped Netflix a year ago;
most all of the old flix I can get at the library for “free” and (5 at a time to boot);
with full “extra” features and boxed sets!
I find that it’s a shame that RedBox has also dropped the FULL features
from their disc rentals, and to me, that is a BIG mistake!
Waiting for someone to gain the edge….
Oh Yes, did anyone tell NetFlix that there is a “Debt Ceiling”
happening in this country?
Wake up dudes!!
To be fair to Redbox that was not their decision to drop all the features. That is on the movie companies. They are selling them rental copies and holding back the features for discs that are for sale. Their reasoning is if you can only get the special features by buying the DVD, then you are more likely to buy it.
so whats your opinion on the netflix price increase for their streaming and dvd plan? personally we do not really care too much because if you really think about it, the more you pay the more titles they can purchase for us and in the end members will be happy again. but what do i know?
Welll IU tell you what then… being as you feel so gracious… why don’t you (and other morons like you)…. pay the two price increases totaling 75% (in the last 8 months) for the rest of us, who have the sense to know when to say NO? Yes…. I definitely think that the “more you pay” is right up idiot alley for you. What a mindless sheep you are.
Update To Increase: Had to call Netflix (866-519-1190) re DVD issue. CSR advised that as I NEVER ‘streamed’ she was “offering me” a monthly price reduction to $7.99 (from $9.99: DVDs: one out/unlimited.) She said had I NOT called I would NOT have automatically received the $2/mo. reduction.
Maybe it’s time for ALL Netflix DVD-only users to call them & ask for the reduction.
Tho’ I’d wondered whether there’d be a price reduction for those of us NOT streaming – I’d never read about it in all the Netflix stories I’d read in the past couple of months. Conversely, it would have helped their bottom line had they mentioned the price reduction in any story they broadcasted regarding their increases. Must be some REALLY dumb PR people in their employ!
ummmmm…… $7.99 is the new DVD only price. They did not give you a deal.
Never said it was a ‘deal.’
But it IS $2 less than I’d been paying AND it’s NOT automatic – it must be asked for AND there’s been no press on it.
Those were my points – sorry you missed them.
You’re just a troll that likes to rain on others’ parades. Must be tough being you.
Wow, that’s a $1 better than I paid 2 years ago for the same dvd plan before Netflix offered streaming. I am disappointed that Redbox is getting newer movies out later and later. Netflix does have some advantages over kiosk rentals if you are willing to pay for it. I wish everyone would stop BMW; no one’s forcing anyone to be a subscriber. Nothing says we’re entitled to have this in our lives. Privilege costs. Everything’s going up – cable, food, gas. If anyone’s to blame, it’s our gov’t for letting the dollar get so weak and shareholders’ need for higher gains every quarter. For those smart enough to buy Netflix stock and seen it rise exponentially, you’ve more than paid for your subscription for life. For the rest of us, I guess we’ll either change our plans or cancel but that’s our choice.
The money is going to the industry and studio heads in the end moron. But you are MORE THAN WELCOME to pay the 60% increase for the rest of us. Privilege? Has NOTHING to do with privilege. Has to do with signing up for a GIVEN price… and then receiving two price increases totaling 75% within 8 months. Where do you get a privilege in any of that you idgit? And this for two services, neither of which live up to billing. One with LONG wait times, the other with LIMITED selection. Can you tell me something please Edie? When did all Amercians become SO EFFIN BRAINWASHED as to automatically be pre-programmed to accept 60% price increases as INEVITABLE AND ACCEPTABLE!!!!???? My god… what is going on in this country is scary. SEND NETFLIX A MESSAGE. Next will be BP and the oil monopolies!!!
What I think Ryan is trying to say is that the customer service rep flat out lied to you. The 7.99 price for the one-out with no streaming plan is the new price effective on your first billing cycle after September 1. All she did is give that to you a month early. If you hadn’t called, your bill would have still automatically dropped in September to 7.99.
I checked the web page that allows you to change your subscription. If you don’t change your current plan, they will (unless you otherwise inform them) assume you want the same plan going forward and charge you accordingly. So if you get one disk and have streaming, your current price of 9.99 goes up to 15.99 in September. On August 31st, I will switch my plan using the web site tool to either streaming only or one disk only and get the 7.99 price.
to Sewunicorn:
JSYK: I asked the CSR that very question: “Would my bill be reduced to $7.99 automatically in September and she specifically said: “NO.” That was the reason I initially posted my info – to allow other DVD-only users to get their price DECREASED. If she had answered, “yes, they will all be automatically decreased” – there would have been no need for me to post this information.
So either she, their website or your info is incorrect. Logically speaking (and playing devil’s advocate:) Netflix would have no need to automatically reduce any of us DVD-only users, when they would merely have INCREASED each of us to $15+ price with their ace-in-the-hole being that any of us could avail ourselves of streaming in future – and NOT the other way around (just as the 9.99/mo had previously covered.)
I hope that made sense.
You guys keep forgetting it’s 7.99 plus 2.00 for blu-ray. I believe Blockbuster’s price is either the same or a little more. And one reply said if more people sign up with Netflix streaming the more movies will be available….Not so. The more people sign up, the more Hollywood will want the increased piece of the action(money). Much of the library Netflix has is made up of Starz old movies along with the networks own library of repeats. Both Blockbuster and Netflix are very selective to the DVDs they add to their library. I had both the streaming and Dvd service of Netflix…I’ve cancelled. I now use Vudu.com because Redbox is very limited to the DVDs one can rent.
i have hulu and netflix, and use redbox. i been thinking of which one im gonna cut out, or use less. and i believe its going to b netflix. hulu is so much better right now. (for tv shows)
Netflix needs to increase their library of streaming titles, I’m looking into Amazon and Hulu for streaming.
I no longer get DVD from Netflix. I can get 2 a week from RedBox for the same price and don`t have to make a list on line. There are 6 RedBox locations within 2 or 3 miles of my house.
I like NetFlix streaming pretty well. But the selection is growing a little boring. I think they are still the best deal[for streaming].
Don’t forget to add in the cost of gas to your Redbox rental. If it’s not on your way to or from work but a separate round trip, that’s another $3-4 plus per gallon of gas used. Besides, not counting streaming, you’re paying for the convenience of having dvd(s) delivered to your mailbox and mailing them back in a prepaid envelope which is cheaper by far. Anyways, if you can stand the wait, start a hold queue with you local library. You will see the latest releases and you’re already paying for it in your taxes. Secondly, while we’re at the library, let’s checkout some books. Reading does the mind good!
Very well said. But the library here has just about zip DVDS..
Hey Edie… how long have you worked for Netflix, hmmm? Several messages from you now on this forum… all of them, telling us how lucky we are that we received a 60 EFFIN PERCENT price increase and how we should be thankful. I say let the morons like you pay the price increases (that includes taxes, gasoline, groceries, etc… etc…) for the rest of us still left with some sense… being as you seem to be such a proponent of price increases in this economy. Your brainwashing to accept inflation has been VERY successful.
Learn to count you uncivil pig! You posted around 7 to my 2 posts today and they were all ugly rants. You are what’s wrong with our country – all foul and potty mouthed. Do you work for some corporation? If yes, when did you ever turn down a pay increase so that the consumers of your company don’t get prices raised on them?! That’s what business is about you idiot. Why don’t you go out and start a company and fix all these injustices? I am sure when you raise prices, which you eventually will, people will say the same things about you? Your handle “GreedISP” says it all…
Right before the price increase we had gotten the streaming (we are still in the trial offer) and i am ready to cancel! I have been very loyal to Redbox because they have what I want to see! Since we have gotten this free trial to Netflix I have still been to Redbox! There has only been one movie I have watched on Netflix and that was just because i settled because it was midnight and did not want to go out to Redbox. I do not want to continue past the free trial there is NOTHING to watch so what am i paying for?!?!? Sad, truly sad.
But this is the ultimate plan Netflix has – get rid of all the DVD hard copy mess. No mailing, not where-housing – cut all that overhead and push the movie companies into allowing more streaming because there is no hard copy option to route though. It’s much cheaper and will reach more people if Netflix does not have to keep anything but digital inventory. No more DVD copies are ‘not available..they are all out right now with short wait notices.’ Give ’em another 2 yrs and they will have the movie companies eating out of their hands with everything available on streaming all the time and charging more for anything that is considered new release.
has anyone also taken into the consideration of the additional costs that their cable providers might charge them? Sure, I too am planning on canceling my Netflix DVD plan and go streaming only, but I also have to make sure I stay within my now enforced cable plan (thanks for that you greedy providers) because of the increased bandwidth usage. For you streaming customers that do not have high end cable packages, you may want to check into your data bandwidth plan with yotu cable providers BEFORE you get socked with an additional and expected huge overage bill. Just like these greedy cell phone providers, so are the cable companies making sure they get their cut as well.
As i said in my earlier posts…. IT IS THE STUDIO AND INDUSTRY HEADS who receive all the money in the end. That is where the TRUE greed is. Not enough that they forced 28 day wait periods etc… etc… now they are trying to wrap their greedy arms around streaming and the internet… before it is too late. People fall mindlessly for this 60% Netlfix increase… and media streaming on the internet will VERY soon… resemble the cable TV pricing “by the drink”…. that everyone was fleeing to begin with. WAKE UP PEOPLE. Stop being sheeple.
I did just drop Netflix combo. I got a months free Blockbuster by mail and I can turn my by mail in at the B&M and get another title also. I usually rent my new releases at Redbox or BBE. Greed is not on the side of Netflix in this one and that is how customers are perceiving this move.
I stoped NetFlix after being with them Umteen years. I am now with BlockBuster. The new set up with them is ok with me. B/B is giving me
(2) in the mail. I then watch them, and then go to the B/B store in town here.
Get (2) more in store DVDs free. And they send me (2) more in the mail.
This = out to (4) DVDs a week for me. Not bad at all. $14.99 a month.
So far so good. And I have Red Box and the B/B box here also..
Buy NetFlix.
I really don’t care what Netflix does in the future. I’m not willing to keep paying for their poor selection of movies available for streaming. I never had the DVD rental on my account, never will. Right now I’m waiting until a few days before my payment date and cancelling. As far as I’m concerned, since they aren’t willing to allow me to finish out the month I’ve already paid for if I cancel today, nor are they willing to prorate and credit me back what they owe me…they can take their service and stick it where the sun doesn’t shine! I will NEVER go back to Netflix,solely for this reason. Greedy (insert your most creative expletive here)!!!
Amen to that~!!! You hit the nail on the head. See what happens when you screw over customers (those who still have half a brain left), and treat them as though they were mindless morons, by insulting them with a 60% price increase for half as much product???? Paying attention Netflix (and the rest of you mindless sheeple who preach about how wonderful and lucky we are for their 60% increase)? see what happoens when you screw customers over who are not stupid enough to fall for your nonsense? that’s what is supposed to happen to a business when you pull stunts like this one. Not have people blog about how fortunate we are for their 60% increase!!! lol. Netlfix… hope you are payign attention to FORMER customers like unhappy and myself…. or you will be left with 100% of NOTHING.
You need to read posts more carefully. Never did I say anyone was fortunate or privileged to pay 60% increases. Stop putting words in other people’s mouths. I am not a Netflix subscriber anymore nor do I own any stock in the company nor do I work for them. If a company raises the price and I don’t think the value is there, then yeah, I will cancel too. But I am not going to rant about it. Or disrespect people for their posts – other than you of course.
Not happy at all with price increase-greed is the only way I see it. Wanted to watch a DVD from Net but stated not avaiable until 7/26. Then web site stated “short wait” went to Red Box and got movie same day. Streaming movies are so old not worth it. DVD wait sad. If they can’t offer or compete in either market then why stay. RedBox is my option right now. Going to cancel membership with Net. To much going out and Big Business keeps trying to reach deeper in the pockets of those who can barley keep anything in them.
GOOD FOR YOU LEASHA!!! Smart girl!!! I am with you… no deeper into my pockets shall they go. ENOUGH IS ENOUGH. Now, if only the rest of America would follow… we can get gasoline back down to $1 a gallon where it rightly should be.
I plan on dropping to streaming only with netflix and just renting the movies I want to watch that are not available through redbox. I do that now any way because the really popular titles always have a wait through netflix any way.
I have already cancelled Netflix but find it interesting that when you cancel they ask you to complete a survey. The survey has different reasons why you are cancelling their service but nowhere does it give you the option to leave because of PRICE!
The people who say they are only keeping the streaming just don’t get it. This is exactly where netflix wants to lead the “herd.” Netflix is disrespecting customers worse than any business in recent memory, except for maybe the fuel companies. The only way to make them responsive to the customers is to cancel the service in large enough masses they feel the impact. Their smug attitude about this is incredibly annoying.
DVD movie nut here! I have a great DVD set up. Two really. A 55 ” inch Samsung wafer thin TV in the Bed Room.With a Samsumg Blue-Ray player. And my home Theater in the Living Room. With a 8 Ft wide x 4 ft high screen. And a QX Pro Projector. And Blue-Ray player. I was a long time Netflix person. But caned them with the last give me the money bit. I know have the new Block Buster deal. $14.99 a month. Two out in the mail. Then take them back to the store. And get two free movies. That is (4) a week for me. Are 16 a month. $14.99 a month is not bad. So far so good.