Shoestring Theory

Currently documenting the house that is eating our lives, we will return to regularly scheduled programming in a couple of more months

Shoestring Theory header image 2

Netflix is lost in mail after 41 percent price hike in 18 months

December 8, 2010 at 12:53 pm by thetheorist

After being a huge fan of Netflix for the last few years, I will be canceling my subscription this month and looking for new ways to procure movies. The last year and a half has seen a series of changes that have turned it from an incredible value to a questionable expense. We’ve had the 3 disc plan since we signed up, so all figures below are based on that.

1. Last year, Netflix added the blu-ray “tax” of $4 a month to our plan
2. This year, it agreed to a 28 day delay on many new releases (designed to cut costs)
3. We’re receiving more and more special “rental” copies of movies with all special features removed (again, a cost cutting measure)
4. Finally, in January an across-the-board price hike that will raise our plan by $3.

So, in the last 18 months, our plan has gone from $16.99 for all movies with all special features, including new releases, to $23.99 to get delayed new releases that have had their special features stripped out. That’s a 41 percent increase that has resulted in a service that delivers less. It pushes our yearly Netflix bill to $288. And the agreements Netflix has made with movie companies should all save on costs, so Netflix is getting it both ways.

Some may argue that Watch Instantly has been quite improved in that same time period, but we use it far less than we watch discs. At the end of the day, the part of the service I care about is being cut back while my costs are being increased significantly.

Brick and mortar renting just really isn’t an option for us. We’re notorious about not getting things back in time. Instead, I’m going to start buying all of our movies and selling the majority of them on eBay. Part of the reason that movie companies wanted to get of these changes made to Netflix was to encourage people buying movies. I hate to fall into their trap, so instead I’ll focus on buying used movies or buying them at incredible discounts. Plus I’ll be selling most of them, thus keeping other people from contributing to new sales.

I’m going to run this little experiment for a year. At the end of it, my hope is that our total cost for watching movies will be below $300, and we will have added some of our favorite movies to our permanent library. Total cost actually could be quite a bit less than $300, as I scored some great deals on Black Friday sales on movies, ones that should at least break even, if not turn a small profit, when re-sold.

I’m sorry Netflix, but you simply can’t cut services, raise costs and expect to keep all your customers.

Tags:   · · · 1 Comment - Follow the string

Leave A Comment

The Submit button may not be appearing or working correctly in IE6. I would suggest upgrading to IE7 or Firefox 2 for full functionality (I'm still looking for a solution to this if anyone knows one).

1 response so far ↓

  • 1 Don Roberts Dec 9, 2010 at 11:53 am

    It’s rare someone has issue with a major type of service and finds a productive alternative instead of complaining and expecting others to change for them. I also commend you for maintaining your legal morals.