Netflix, Qwikster, And Damage Control...

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JakeStratham

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By now, you've likely heard that Netflix is splitting their streaming business from their DVD business. The latter is getting shuffled to...


QWIKSTER.jpg



If you current get DVDs and stream, you'll eventually need to go into both websites (Qwikster and Netflix, respectively) to get things done.

I know a few of you were interested in this stuff back in July. Here's a new piece by McArdle on the shift...

The Qwikster and the Dead - Megan McArdle - Business - The Atlantic

McArdle is smart, has business training, and leans lib(ertarian). It's an interesting piece, and will help you ignore the (ignorant) consumer uproar that is sure to follow Hastings's move.
 


Longterm, this is a smart move by Netflix. Pachter predicts Netflix's streaming content licensing costs will rise from $180 million in 2010 to a whopping $1.98 billion in 2012.

However, I think Netflix really fucked up in implementing this price increase. If you have to increase prices, then you really, really should have a perceived value increase as well.

If I was Netflix, I would have made 2-3 big content deals (think:HBO/Encore/Film Company Acme) and announced my price increase in conjunction with the content deals.

When you pull that off the headlines read: "Netflix lands 3 big content deals, increases prices as a result".

I think the perceived value increase would have really stunted the contraction Netflix recently experienced.

Netflix is predicted to lose over 590k subscribers in Q3, and that's factoring in new subscriptions they picked up. You can safely peg the total amount of subscribers lost in the range of 1-2 million. That puts the revenue lost around 10-20 million a month, or 120-240 million a year.

If Netflix had announced major content deals (which they need to do anyway) with their price increase, then I'd conservatively guess that Netflix would have saved $60 million a year in revenue.
 
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Falian said:
Longterm, this is a smart move by Netflix. Pachter predicts Netflix's streaming content licensing costs will rise from $180 million in 2010 to a whopping $1.98 billion in 2012.

However, I think Netflix really fucked up in implementing this price increase. If you have to increase prices, then you really, really should have a perceived value increase as well.

If I was Netflix, I would have made 2-3 big content deals (think:HBO/Encore/Film Company Acme) and announced my price increase in conjunction with the content deals.

When you pull that off the headlines read: "Netflix lands 3 big content deals, increases prices as a result".

I think the perceived value increase would have really stunted the contraction Netflix recently experienced.

Netflix is predicted to lose over 590k subscribers in Q3, and that's factoring in new subscriptions they picked up. You can safely peg the total amount of subscribers lost in the range of 1-2 million. That puts the revenue lost around 10-20 million a month, or 120-240 million a year.

If Netflix had announced major content deals (which they need to do anyway) with their price increase, then I'd conservatively guess that Netflix would have saved $60 million a year in revenue.
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You know just before they did the price increase. I seen the article you are talking about.

You are right on a PR level they should have secured deals and made the value better.

They where foolish in that right, but thing is, they really did not raise the price as much as make streaming and dvds seperate.


I never get the dvds, so my price does not change. People who want both can pay for both. The ones complaining are stupid to not see the value right now.

Sad though, I heard they lost Starz and that is going to fuck them in the long run. Netflix gamed the hell out of the streaming and now it is coming back to bite them in that ass. Reason they are paying more for it is because there are more people doing it. They way oversold what they where suppose to for Starz and other places and pissed them off.
 
I didn't know they'd lost Starz stuff. I don't have a Netflix account but I'd been thinking of getting one...now I don't know if I should.
 
hakkairu said:
Really your making fun of the name


They said that shit about a bunch of other companies about there name now there worth billions
Click to expand...

Did you mean Quixtar, QuickStar, Kiwkster, Quickster, Kiwk Star, and Kickstar?

lol why not just Netflix D?
 
DVDs? Seriously?

OldWoman.jpg


Should've just eliminated that shit altogether. DVDs are for Christian communities and that elegant lady above. Everyone else has computorz and other gadgets with Intermawebs and streaming. Like everyone. And everyone can even afford the bandwidth by now.
 
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