Netflix CEO says Blu-ray premiums coming "very soon"
By Darren Murph 
posted Jul 26th 2008 4:56PM
posted Jul 26th 2008 4:56PM
Netflix taketh away, and Netflix giveth. Netflix is about to taketh once more (this time from your wallet), with CEO Reed Hastings noting on a recent conference call that the promised Blu-ray premium would be instituted "very shortly." Specifics weren't mentioned, but we are hearing that the new pricing will be applied across its entire subscriber base "based on how the tests go." Hastings did note that BD rentals still make up a "very low" percentage of rentals, but of course, that will obviously change as time progresses. Any guesses as to how much said "premium" will be?[Image courtesy of WorkItMom, thanks Dan]
If it means they actually have blu-ray titles in stock, I wouldn't be as angry/disapointed by this move.
it prob wont be anymore than $1-4 extra no big deal as long as they start buying more movies
I'll probably try out blockbuster if they keep their prices lower.
me too.
this is so shitty......we are gonna charge more money because we feel like it. How is this helping blu ray become mainstream. Its the same thing with charging extra for hd programming on cable and satellite providers. If hd is the next standard in television viewing, why is everyone trying to make it to be a premium? They should just make more blu rays, phase out dvds, and charge the same.....and netflix, is it really costing you guys more to send me a blu ray over sending me a regular dvd?
They're charging more money because the discs cost more money. If it costs more for Netflix to supply Blu-ray discs, why the hell wouldn't they charge more? Do you think they should just sacrifice their revenues for the benefit of people adopting Blu-ray? Would you if you were running the company?
No, but I assume it costs WAYYYY more when they purchase 10,000 copies of "I am Legend" on BD than it costs to purchase the same amount of the same title on DVD.
They have to pass the cost on at some point.
Currently I get my DVD's next day, if they can make BD's next day, I would not mind paying $1-$4 more. $22 a month for unlimited 3 movies at a time is still cheaper than buying a movie that I would probably watch only once a year.
and that is only $2 more than blockbuster currently charges for 3 at a time rental
I get my BR next day, and most releases like 21 I've received ON the release tuesday.
I'm sorry but I just don't buy it. Studio heads aren't stupid (at least when it comes to trying to squeeze money out of consumers). It costs them next to nothing to offer content via download services, yet they're still investing plenty of cash in developing and marketing Blu-Ray -- even indie studios that don't have a ton of capital for investments that don't pay off. Blu-Ray is either profitable, or they have good reason to believe it will be in the near future, or they wouldn't do it.
Personally I think this holiday season will be to BD what last year's was to HDTV; and to me, it's fairly obvious both why BD hasn't massively caught on yet and why it definitely could in the future, but I've gotten into that before. All IMHO. Either way, I'll happily be part of a niche group that's currently enjoying the very best A/V quality bar none.
thats not as a sony fanboy, since i never ever even owned a sony gameconsole. considering maybe if re 5 is better on the ps3 than 360, and interested in reistance 2, but im cool with a 360 and wii for gaming. but the ps3 so far has been selling better than the ps2 within this same period of its life time, and interest in gaming has grown amoung the population so its obvious this gen consoles ill outsell lasts, and the ps3 has been picking up steam for the past few months world wide.
This is a dumb move by Netflix. By raising prices for blu-ray users they will be pushing people towards Blockbuster. This is similar to what happened earlier this year when Blockbuster raised prices and people went to Netflix.
Honestly, if the price increase means they are in stock, that is fine with me. You are going to pay for it one way or the other - be it everything out of stock, or more money.
There is nothing for free.
So, you're going to charge more for a disc that claims that due to its protective coat it lasts longer. The rental fees paid to studios should not be any different. Who really knows. I don't particularly care much for it though.
I think they're just charging more for discs that, on average, seem to cost around 50% more than DVDs.
I don't see a problem with that. And for those arguing it'll push people towards Blockbuster, well, BB may well do the same thing in the longer term, or Blu-ray prices may fall and Netflix can reduce their prices again; but in the short term Netflix wouldn't be losing that many people, not with Blu-ray player sales still barely registering. Those customers they'd be losing are customers that cost them more at the moment than their other customers.
And, I don't know about you, but I'm itching to find out what Netflix's HD downloads service is like.
ONE HUNDRED MILLION DOLLARS!!!
No,
"One Million Dollars"
mwahahahaha
Silly world we live in.
"Saturday night, high and dry ...."
I'm very disappointed in Netflix for doing this... although not very surprised.
It is sort of boring but LCD technology is fairly mature and there's not a whole lot of "leaps and bounds" going on with it.
Oops sorry about that above post. Wrong topic.
Anyway the only thing I don't like about the situation is NetFlix starts renting BD and it doesn't charge for them. Then all of a sudden they decide to. If they would've said upfront that there would be a premium to rent them and let people decide BEFORE they started renting BD I wouldn't have any problem with it.
This sort of smacks of a drug dealer giving you the first taste for free.
We'll see if this lasts. It'll definitely determined by the market.
For me, I'll wait and see what the increase is and what the options are going to be with Blu-Ray rentals. If it's a bit too much, I'll simply reduce my NetFlix plan to balance out the increase.
Still, I like NetFlix. I like their DVD's. I like their Blu-Ray's. I like their download service. I use them all. If I can get the downloads onto my big screen TV, I may never get around to adding FIOS TV to my FIOS Internet.
if i can get new release blu rays like i can get new release dvds then i could care less what they charge me. right now its takes me about two months to get new release blu rays. its could also be that i get about 6 discs a week on a 2 disc plan. w/e its still crap. hopefully they keep watch now free cause then thatll be about 8-9 movies a week for me.
sorry for doublepost
if i can get new release blu rays like i can get new release dvds then i could care less what they charge me. right now its takes me about two months to get new release blu rays. its could also be that i get about 6 discs a week on a 2 disc plan. w/e its still crap. hopefully they keep watch now free cause then thatll be about 8-9 movies a week for me with the new xbox feature.
I think even if HD-DVD won the format war, Corporations and Studios would hike up prices to take advantage of consumers. I mean, come on, its "High Def" and that is the hottest thing right now and people will pay premium prices for it. They are going to milk you for your loot one way or another.
If they're gonna charge, they'll need to increase the availability. Cloverfield has been on "long wait" for about 6 weeks now. They're so backed up on BluRays they sent me my 9th position disc last time they sent me a disk.
Netflix, I think you're making a mistake. But if you're gonna do it, at least do it right.
If they lose a percentage of people, then that should help. I bet some people with PS3s are renting blu-rays even if they don't have an HDTV. I know I would. Its basically a guarantee the disc won't come damaged.
as long as its no more than $5 more per month for the 4-movie plan I'm good.........
and I agree with everyone that says they need to get more copies..........
I've had long wait on ALL my Blu-ray new releases for weeks........
I even tried removing EVERYTHING but the New releases from my queue so that they wouldnt send a movie 10 down from the top and it didnt work.........I have had 2 movies now for the last week but I'm paying for 4 out at a time.......
Sony doesnt OWN Blu-ray.........they are part of the board that gets royalties yea..........but they dont SOLELY own it.....
and why cant people like you get over the HD-DVD thing..........they tried and failed........THIS time the Better Tech won.........
sure They want Digi Downloads and all but they are not going to get rid of BD for them.......they would much rather Alienate the 1.5 Million people that had HD-DVDs than the 12+ Million people(by year end) that will have a Blu-ray player........
Sony doesnt OWN Blu-ray.........they are part of the board that gets royalties yea..........but they dont SOLELY own it.....
and why cant people like you get over the HD-DVD thing..........they tried and failed........THIS time the Better Tech won.........
sure They want Digi Downloads and all but they are not going to get rid of BD for them.......they would much rather Alienate the 1.5 Million people that had HD-DVDs than the 12+ Million people(by year end) that will have a Blu-ray player........
last time i checked only 6% of my Q was in blue ray, so i'll pay 6% of whatever this BS additional charge is.
@ whynot, you're waiting for cloverfield? we got it yesterday....and for some reason it came in DVD not Bluray - wtf, netflix????
Yeah, Netflix posts better than expected profits this past quarter and they still find a need to justify charging a premium??
Anyhow, I imagine that the demand for BD's is increasing, but from their current subscriber base. If theres an increase in subscribers that is attached to the increased demand for BD, then they can't justify charging the premium.
I don't know how Netflix acquires their discs, but I assume that they pay much more for Blu-Ray than they do for DVD, even if they are getting a deal. If this were true, then the only way to make it profitable for them to have BD readily available would be to purchase higher volume of BD titles at their expense and then charge accordingly.
I'm sort of surprised they haven't done this all along. But I don't blame Netflix (for this). I blame whatever is keeping the BD prices so friggin high still. Is it manufacturing, still? Is it greed?
Good bye, Netflix. Well, hello Blockbuster!
If you assume that about 2.5% of Netflix's 8 million+ customers rent Blu-Ray, then that is about a quarter million customers. If you assume that Neflix has 250 million distribution centers (which is about right -- I believe the number is in the hundreds), then Netflix is serving about 1,000 Blu-Ray customers from each distribution center. That may sound like a lot, but it is probably not enough to run the Blu-Ray side of the business profitably, if it were possible to physically break it out.
Netflix used to charge $20 per month for 3-out, and they once bumped it up about $3 per month higher than that. Netflix was losing money when it had fewer customers. The larger subscriber base has enabled Netflix to generate profits. I think Netflix has every right to bump the price, but the competitive threat of Blockbuster is very real, especially when you can probably get the same number of movies from a 2-out Total Access plan as you do with a 3-Out Netflix plan. And there are always Blu-Ray discs available in the store (whether they are the discs you want is a different story, however).
I would like to point out that you don't have to do the in store trade thing. You can just get a blockbuster account with only movies in the mail. Blockbuster's 3 at a time is 15.99 compared to netflix's 16.99. Both have 2 at a time for 13.99. If netflix raises their price by even a dollar a month, then blockbuster's price would only be $1 more for an extra movie a month. That is an obvious switch to me, at least to see how it goes.
Spiza, I am well aware of the many benefits of Blockbuster Total Access over Netflix. With Total Access, however I have found that I can usually get so many movies that I can have movies for a full month after cancelling.
With Blockbuster, you don't have to return movies for 30 days after cancelling -- Netflix wants your movies back after 7 days. The Total Access Exchanges can be kept out for about 5-6 weeks (I usually do get hit with about $5 of re-stocking fees when I use Total Access).
I do get some cost savings out of an every other month cycle with Total Access, but I find that I just end up with so many movies with Total Access that I just about "have" to cancel.
Leonardo
Just this weekend I went and read all the terms and conditions for Blockbusters online and Total Access program and you have some inaccuracies in your statement. 1) If you cancel your membership you have 7 days from the expiration of your contract to return any discs 2) the most expensive plan only allows 5 in-store rentals per calendar month (not unlimited) and 3) any in-store rentals fall under the stores rental policy - you can not keep it for as long as you want and after a certain period of time you'll be charged to purchase the movie if not returned.
I have a PS3 and I don't see any huge advantage to Blu-ray over standard DVD on this machine. Side by side maybe but with the automatic up-conversion of standard DVD's they are pretty good.
Also, there is not a great deal of special features on Blu-ray yet. When they start having special features that really differentiates Blu-ray I will be more interested in renting them.
I will probably cancel the Blu-ray feature on my Netflix account if they charge more because I just don't see much value.
Thats cuz yer using teh "RF" cable for video, on an SD TV.
I see a pattern here. Nfinity leaps onto every blu ray thread and parrots the exact same lies. Then he gets his ass handed to him and the cycle repeats. EngadgetHD should ban him. His only goal appears to be troll and infect every discussion with his own brand of idiocy.
I'm still waiting on Rambo on Blu... how long has this stupid movie been out?? And now i have to pay Extra for the one month wait on blu-rays??
Pff... they can go kick rocks with that bullshit...
More than I intend to pay without owning the discs, I assure you.
Mostly @ Nfinity
I hear you and I must be in the minority who agree with most of your statements. Now with that said unless they can get us 1080p HD unfiltered downloads, I'm going to have to stick with Blu-Ray disks. I'm old school in that I like to have and must have a physical copy of movies I love. Official copies are preferred. Music not so much anymore oddly, but with Movies yes... Actually any physical disk media will have to stay right along with downloads for me. Downloads for renting and Physical media for keeping.
Now if the cable companies could get to fiber optical speeds across the board and content is in unfiltered form in splendid 1080i/p, that's when I'll totally believe Blu-ray or anything like it is on it's way to extinction if these corporations have their final say. Among many others, I really dislike Sony's lack of quality the last 10 years and in their douche bag business practices, since 1990 when I noticed, but what choice do we really have now? HD-DVD was better yes. Just seeing as they were cheaper, programmed better and really well thought out from day one. But hey, for whatever reason Sony's won this time and we'll have to take the bullet and see if HD downloads (Which will be greatly DRMed) becomes the norm.
P.s. I'd just be happier if Blu-ray prices went down to normal price land. They might hold more but more of what I am still waiting to see. Anyhow its not like the economy is doing amazingly well either for the way they are priced. Plus I feel there are some serious gouging practices being implemented here that someone or thing has to stop. Super anti-productive really, which makes me, along with many do tell moments, that it looks like Nfinity's views in general are closer to reality than what we all wish would happen.
Remember, on a simple level example, when you see a sale of any thing it's not the Companies/Corporations being nice to consumers, its for their own interests. That movie you wanted that is going on sale isn't all gravy, it's more than likely just to make room for a better and if lucky final version of said movie. We have to open our eyes, help each other with insider news and allow everyone to share insights and opinions regardless if they go against your own wishes and beliefs.
We are the HD community right? Come on now.
I just signed up for a new account and added Blu-Ray access. It popped up a notice that after my free trial is over there will be a $1 per month premium for Blu-Ray access.