Netflix, what an interesting company. They have been a pioneer since they opened their doors in 1997 and a few months back, my wife and I finally caved and decided to keep a subscription beyond the free trial.
We actually were full members of Netflix back in 2006 when they only offered DVDs and the plan was cheaper. The reason we canceled our membership was that we moved to a more remote location in the US and it took almost a week for our DVD’s to be delivered where prior to that, it only took about 2 days…that’s really not what this post is about though.
Netflix has come a long way since its beginning. As an innovator, they have overcome continued skepticism of their every move. Why would anyone want to subscribe and have to wait for their movies to be dilevered when they could just step out to the nearest Hollywood or Blockbuster and grab the newest release.
Netflix overcame that obstacle with their price point. For only $12 a month, just over the price of two movies from the local place, you can get unlimited DVDs delivered to your door, two at a time even. No late fees, no delivery fees and an online queue to remember, rate and get suggestions on movies you want to see.
Soon they had imitators and put brick and mortar competitors completely out of business. Those that couldn’t adapt quick enough disappeared…the few big boxes that held on struggled to find a way to compete.
The next bold move that caused Netflix customers to become skeptics was the separation of the DVDs and the streaming services. Prior to this move, you could stream unlimited movies to your computer or Netflix device as well as receive DVDs in the mail. There was no option to choose one or the other, and the price was reasonable for the most basic plan. After the separation, to get both streaming and DVD deliveries, you’d need to have two plans; one for streaming and one for DVD delivery. For those that used both of these services, this was an outrage. The price increase to have both services was a double-digit percentage, but it wasn’t outrageous considering the quality of service compared to traditional movie rental means. However, people were outraged.
Netflix stock took a hit, they eventually scrapped plans to separate the services and continued to take heat from customers.
Netflix did keep the separate service plans though and I defend their move, aside from the branding (changing names is not a good idea for a company as well branded as Netflix). Here’s why. If you look over the history of the movie industry, formats come and go with time. When something new comes along, the previous device, format and even recording technology is replaced by the newer, better option. Eventually DVDs will be replaced..but with what? Blu-Ray? I don’t think so. They are already being replaced with the digital stream. No media, no scratches, no delivery time. No matter what format comes after DVD, Blu-Ray, whatever, streaming is the future.
And that’s why we decided to again become members of Netflix. We subscribe to the streaming only plan. It’s cheaper than prior Netflix combined plans and we get everything we ever wanted from a movie service; unlimited streaming of movies and TV shows right to our TV via a Netflix capable device.
My prediction for Netflix is people will continue to sign up for Netflix leaning toward the streaming only plan based on its cheaper price, instant and unlimited nature, and huge and growing availability of devices especially those with mobile capabilities. Netflix will continue to improve upon the streaming plan, compression and quality, as well as movie offerings and they will eventually scrap the DVD plan again. They will continue to be a household name for movie watching.
What do you think? Will Netflix die out and be replaced or will they take streaming to the next level? br>