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Comment by chime | Hacker News Reader

I don't know why people are complaining so much. The company did exactly what they should have - they hiked the price to stay in business and clearly informed their customers in advance. Evidently many people were abusing the unlimited streaming + DVD subscription before and it was not cost-effective for the company to continue to offer the deal.

Percentage-wise while it sounds a huge increase, it is absolutely nothing when you look at the real dollars. My cell phone bill is $100+, ISP is $70+, web hosting is $30+, and I pay $10+/month for many different web services (include many startups I found via HN). How is $8/mo for renting 3-4 DVDs a month too high? Sure, it was $2 before but you can't expect any company to make money on deals that get abused by more than a few.

I'd rather have Netflix charge their customers appropriately than go out of business or start nickel and diming like airlines or cellphone companies.

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The pricing doesn't seem all that great. Take $7.99 per month for 1 DVD out. That equals to 8 DVDs rented for one of those DVD rental boxes in a grocery store (RedBox, BlockBuster) assuming you return them the next day. In order for you to rent 8 DVDs in 30 day month, you have to be getting new DVDs every 3.75 days.

So basically, in order for it to equal the cost of a comparable product, you have to get the DVD and watch it the same night, then ship it back and hope 2.75 days is enough for Netflix to ship you another one.

Don't know about others here, but I don't really get time to watch DVDs during work days. This leaves the weekend, so for $8 a month, I can rent 2 DVDs per weekend and receive greater amount of entertainment during a more convenient time.

So using your example of 4 DVDs per month, that's $2 per with Netflix or $1 (50% less) per with box rental services. So in terms of actual spending, you are still only saving 4 bucks (not even a cup of coffee), but % wise, you save 50%.

(and yes, I go to the store regularly, so I'm not counting cost of gas in this example)

Now, if they only had the latest stuff in the streaming catalog... that would be entirely different story.

If you only watch new releases, your math makes sense.

But the big draw of Netflix DVD by mail is its enormous back catalog. The size of the Redbox library pales in comparison.

Very true, and that is also where their streaming service is reasonably good. Although, there are still holes.

I'm angry at them because their explanation is purposely dodging the real cause of the price hike.

I want to stream everything but I can't, so I still get DVDs. And since I still get DVDs they need to raise the price on me.

If they just came out and said "Sorry we don't have more digital content available." there wouldn't be an issue. Instead they are acting shocked I'm not satiated with their anemic online offering.

Bonus Fact: Netflix and Groupon have the same operating cost yet Groupon offers no physical or digital products.

I would argue that they did not clearly inform their customers. I found out about this through a post on Engadget, which led me to the Netflix blog. For a change as significant as this they should have emailed every customer. Unless they send out an email between now and then, I'll bet a large percentage of Netflix subscribers won't "discover" this change until they are suddenly billed 20% to 50% more in September.

Evidently many people were abusing the unlimited streaming + DVD subscription before and it was not cost-effective for the company to continue to offer the deal.

How do you abuse a plan advertised as "unlimited"?

I don't know about Netflix in particular (their TOS is pretty impenetrable), but it's pretty easy depending on what terms you agree to. What are their views on having me stream in San Francisco while my brother in Portland only uses the DVD queue? (Hypothetically, of course. My subscription is streaming-only but I'd be surprised if similar situations weren't fairly common.)

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