Today, Netflix announced a change to the pricing of its DVD and streaming plans. The company is now splitting the two services, offering DVDs by mail and streaming movies from the service as two completely separate products.
The new pricing for each service is now $7.99. This means that if you want to get physical DVDs from the service, as well as stream its online catalog, you’ll have to pay $15.98, a 60% increase over the previous price of $9.99 for the 1-at-a-time unlimited DVDs and unlimited streaming plan.
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This change in pricing means that the unlimited DVD customers will actually have their costs lowered by $2 at the new $7.99 price, but that plan no longer includes streaming of any sort.
Jessie Becker of Netflix explains the thought process behind the new plans stating, “Last November, when we launched our $7.99 unlimited streaming plan, the DVDs by mail plan was treated as a $2 add on to our unlimited streaming plan. At the time, we didn’t anticipate offering DVD only plans. Since then we have realized that there is still a very large continuing demand for DVDs both from our existing members as well as non-members,” said Becker. “Given the long life we think DVDs by mail will have, treating DVDs as a $2 add on to our unlimited streaming plan neither makes great financial sense nor satisfies people who just want DVDs.”
This new plan structure is not getting a very positive response on Twitter and in the comment thread on the Netflix blog posting. Many users seem to be upset by the pricing changes, citing the relatively spotty catalog of Netflix streaming choices as a reason that the company should not raise its prices for a streaming-and-DVD plan.
Commenter Jasmine Elzy voiced her frustrations, “You might have just lost a loyal customer. A customer who keeps the “1 DVD add-on” just in case there’s something not on streaming that I want to watch. I don’t USE the DVD add on enough to be worth $7.99 & your streaming selection isn’t worth $7.99 alone. See ya later, Netflix,” adding, “Oh, and Hulu Plus, here I come.”
The new plans offer an expanded selection of choices for Netflix users, and they absolutely lower the cost for DVD-only customers, although the streaming only plan stays the same price at $7.99. But the anemic selection of the streaming services means that there may actually be a larger segment of Netflix users that like the ‘safety net’ of a DVD for new releases now and then more than Netflix anticipates.
The pricing will go into effect immediately for new customers. Existing customers will be moved to the new pricing on or after September 1st.
Do you think that the new DVD only pricing is a good thing, or are you one of the many Netflix users who likes the DVD plan along with their streaming, just in case?