Netflix Rate Increase Is Still A Deal, Stop Whining.

Netflix raises rates, irks subscribers. This was the headlines a few days ago as Netflix announced it would be changing their subscription service and rates. Today for $9/month you can get online streaming and 1 DVD rental out at one time. That was the best deal out there. You can pay higher to have more DVDs out at one time if you are a high movie watcher. Netflix changed it and basically split out their online service and DVD service, it’s no longer combined.

At first I was like the rest of the masses and was a little upset over it. A few days went by and as I was watching a few episodes of Star Trek The Next Generation I realized something, Netflix still offers an amazing service and this change is really not a big deal if you think about it intelligently.

As a user, any time a company you do business with raises its rates you immediately cry foul and think they are screwing the customers. For Netflix this is not the case, this is part of a strategy that is moving forward which will set the future for home entertainment and the end of physical media. In order to get that differentiation in the industry set, they had to break out streaming from physical discs. In the wake of the rate announcement the CEO of Netflix came out and made a comment that the additional revenue brought in by the increase will be put into the online streaming service. This statement shows that Netflix is focused to move that direction. It’s cheaper for them, no more mailing, physical purchasing of the discs, replacements because of damage or theft, the people to sort, etc… Reducing that and replacing it with infrastructure is a better investment long term. You can increase your streaming library without increasing infrastructure. You increase your physical inventory you need more people to maintain delivery levels.

Even with the rate increase, Netflix still is a great deal at $15/month for streaming and 1 DVD out at any one time. If you are a heavy movie watcher, with mail time you could get about 3 DVDs a week, that’s 12 a month. Not counting streaming, that is a little over a dollar for each rental. Go find a rental store that has that rate. Now throw in streaming and you have thousands of movies and TV shows at your finger tips. All for $15/month. That’s a deal! If Netflix had every DVD in their catalog available in their streaming service I would pay $30 a month for it and maybe more. I learned something a long time ago, don’t look at the price look at the value you get for the price. Netflix deliver value you can’t get anywhere else.

What about Blockbuster? Blockbuster has a mailing service like Netflix true. If you don’t like the rates then you are free to move. But you will not get the same value and service that Netflix provides. Netflix’s advantage is how you can consume their service. If they had stuck with the PC only then they would be fading away, their partnerships with Blu-Ray player manufacturers, Microsoft, Nintendo, Sony was what made them kings. I don’t use Netflix streaming on my PC. I am at a PC most of the day and having to sit there for streaming is just not appealing. Building a PC just to stream media is not effective. However, firing up Xbox live on my 65″ HD TV to watch is a different story. Having the family watch the latest kid shows or movies from the Blu-Ray player in the family room is convenient. Catching a quick show on my iPhone or iPad during my commute can’t be beat.

All for $15/month.

So you can complain about paying a few dollars more a month for Netflix, but when you look at what you get from it you really can’t say it’s too expensive for what you get.

End of Line.
@binaryblogger