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And that my friend is why "Suck em in first then raise the price" fails.
2011 Oct 25, 12:50am 1,955 views 7 comments
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MisdemeanorRebel
2011 Oct 25, 6:22am
The real culprit is the Studios, who squeezed the hell out of Netflix in terms of royalties. Netflix was just passing along their increased costs
TPB
2011 Oct 25, 6:35am
If they didn't Flinch then they could have Sued the studios.
By placing the impetus on the user to pay up, they have nothing to stand on when their User base pushes back, and bails on them.
I think the people have spoken, 4.50 a month is the price point for streaming video. Not 9.99, 9.00 if you include mail order Disks as well.
This is why iTunes has not become the Global purveyor of movies.
They've been offering them for .99 cents a pop for years.
At 9.99 you would have to watch 10 movies in a month to justify it at even iTunes prices. Provided Netflix streaming library, that wouldn't be very unlikely.
There's rarely I ever find 10 movies to watch on HBO in a given month.
MisdemeanorRebel
2011 Oct 25, 6:56am
Netflix got more subscribers than their licenses would cover. They had little choice but to unbundle their DVD Rental/Streaming package into two sections.
Unlimited Streaming and Mail rentals for $16? 20 years ago that was the price of renting 4 or 5 movies, and you only got to keep them for 24-48 hours at most places, plus drive there, and a more limited selection to boot.
$16 a month for both streaming and mail sounds pretty good to me.
The real culprit is the Studios, who squeezed the hell out of Netflix in terms of royalties. Netflix was just passing along their increased costs
Yeah, exactly. The early adopter studios paid the price -- they got underpaid for their content. Of course, lots of the studio contracts have since been renegotiated for higher fees. Netflix was never quite economical as a streaming business at the original price per month. The price only made sense when Netflix had a tiny amount of content that was available for streaming.
If they didn't Flinch then they could have Sued the studios.
Based on what claim? That would be a frivolous suit if I ever heard one.
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http://money.cnn.com/quote/quote.html?symb=NFLX&source=story_quote_link
Netflix Inc (NASDAQ:NFLX)
77.14
-41.76 / -35.12%
Today’s Change
74.33 Today|||52-Week Range 304.75
NEW YORK (CNNMoney) -- The Netflix nightmare continues. Shares plunged 36% in early trading Tuesday after the video service revealed it lost 800,000 subscribers in its difficult third quarter.
Now is that on top of the initial Million or so, that was reported to have ditched them in August?
Netflix (NFLX) earned $62 million, or $1.16 a share, on a record $822 million in revenue in the quarter that just ended, beating analysts' estimates. But shareholders ignored that fact and focused on the sharp decline in its subscriptions.
How do you make money when everyone is bailing?
http://money.cnn.com/2011/10/25/technology/netflix_stock/
Ever notice the numbers don't add up, these days when News sites do these cheer leader pieces.