The Netflix gravy train is over folks. Today the company unveiled a new, more-expensive pricing structure for streaming movies and renting DVDs. Come September 1, Netflix users on the DVD + streaming plan will have to shell out $15.98 a month to continue the privilege -- a $6 increase from the previous $9.99 price tag. New members will be hit with the new rate as soon as they sign up. The change marks the second time Netflix has raised its rates over the course of eight months.
Why the $6 increase? Jesse Becker, Netflix's VP of Marketing, blogged that keeping prices as they were "neither makes great financial sense nor satisfies people who just want DVDs." According to Becker, when Netflix created the streaming-only plan in November, they didn't anticipate that subscribers would want a DVD-only plan as well. Since there continues to be a healthy demand for DVDs, Netflix felt that it was losing money charging customers a measly $2 for DVD rentals hence the new plans and prices.
It's no surprise that Netflix's DVD business continues to flourish, since the company's nascent streaming only service doesn't offer nearly as many choices. I can't count how many times that I've searched for Equillibrium, Snatch, or The Warriors on Netflix only to discover that movies are STILL unavailable via streaming. Andy Rendich, Netflix's Chief Service and Operations Officer, has been tapped to oversee the DVD-only management team.
Subscribers that want to stay strictly disc-ly have the option of renting one DVD at a time for $7.99 or doing a two-fer at $11.99. Consumers that prefer streaming can sign up for the $7.99 streaming-only plan.