Netflix: How to completely screw up As recently as June, Netflix looked like one of the biggest consumer success stories in digital media. The company was already synonymous with DVDs-by-email, an idea imitated worldwide, and was bundling on-demand TV and movie streaming at an incredibly low price. By May, Netflix traffic had overtaken Bittorrent volumes in the …
If you're in Los Angeles then streaming looks like a great plan, but if you live in Mississippi or any other rural part of the USA then you've got a drive to Blockbuster.
The basic problem with streaming video is that it takes a relatively fat pipe - 15kbs down a phone wire isn't an option if you want to watch the movie this month. There are very large areas of the USA where the only internet option is a phone modem over 5+ miles of wire strung on the utility poles ... speeds of up to 28kbs are possible so long as it does rain and nobody shoots at the insulators on the phone wires. Other than some minor tweaking, broadband speeds have remained virtually unchanged in the US for the past 6+ years and there's no real incentive for the providers to do much about it.
In other words, streaming is running full speed towards a brick wall.
Well that and the ISP's like AT&T swapped to capped internet from unlimited kinda put some people off of streaming. I know I forbid anyone in the house to use netflix cause without it we are hitting damn near the cap monthly where before they imposed it, and the house used netflix a lot I was like 30 gigs over the now in place cap.
Thanks to the scare campaign against "Net Neutrality" advertised by the cable companies and the telcos; they can throttle their current bandwidth from now until the end of time, and won't ever have to upgrade their pipes.
Funny thing about it was that it was the good ol' boys shouting "Keep you gov'ment hands off my internets!" that took the power away from the FCC to enforce fair traffic handling and handed over the keys to the big corporations to do as they please. The good 'ol boys that live 5 miles outside of town.
Enjoy your 28.8kbps service from your choice of any of the one providers, you wanted it.
> Wireless and satelite #
>
> are options. You're just not willing to pay for them.
Who cares about "cost"? Neither of those work nearly well enough.
They simply can't compete against a good wired Internet service.
Doesn't matter what the price is when the product is total crap.
I get my DVDs by mail from Blockbuster and am not interested in leaving. Hopefully they will stay around. I am not interested in their streaming service. When Netflix changed the pricing, I took advantage of their one month free offer on the ps3. It's not perfect, I find it useful enough to continue.
No mention of the massive price hike that the movie industry has put on Netflix? The Starz deal wanted to increase their take from 30 million to 300 million, which won't be renewed. That's quite a bit more than the 60% rate hike. Other content prodivers are pulling the same crap.
Why is it Netflix's fault that they're not selling their product at a loss now?
I certainly do look forward to the Netflix aspects of my TV or game console being useless, after the fickle Internet whinges them into obscurity.
If that is why they are doing it then Netflix would keep a lot more customers if they actually tell the fucking public that this is why.
At the moment the alternative is illegal downloads, of which the movie industry gets nothing. But then again the movie industry has never been known for its intelligence has it?
Sorry - that sounded very snippy there. It wasn't meant to be directed at you.
What I was meaning was - instead of helping to compete against free but illegal ways to acquire TV/movies by setting-up other streaming companies or by helping netflix go international etc. they are just being as greedy as ever and screwing themselves (and the public) in the process.
Unless you're a child or love Anime, or kids shows Netflix streaming a huge waste of money! There is next to nothing for online viewing newer than 3 years old or something that lived in a theater for about 2 days before it was pulled. Unless Netflix gets it's Streaming Service updated with ALL its titles its gonna lose HUGE!
The quality of Netflix streaming on a decent broadband connection is quite good, not withstanding some codec artifacts, especially in dark scenes. So, I liked having the Blueray option for those times when I really wanted the best quality.
But the new price plan killed that option for me, especially since the streaming catalog growth seems to be slowing noticeably and Netflix lost the Starz contract.
So, now getting less for much more, I dumped them.
I just hope that my premium account on Spotify doesn't suffer the same fate.
Shouldn't come as a surprise that corporate america hangs itself with it's own fabric. These companies have people paid a salary to brainstorm and heres the result of that.
Where I live the redbox store units are very popular and while they don't offer such a vast selection of titles they do offer instant gratification.
The streaming of digital media will face future problems as network operators are going to refuse and throttle the traffic without additional payments.
Average nice HD movie is usually around at least 1gb to download. Just imagine having your household wired to all internet television. Comcast and others have done this yet the one thing that's never much figured in is how much it's going to cost. Unless they have unlimited plans for this comcast only gives you 250gb a month of traffic.
When your downloading titles and also streaming all your daily life on the internet you'll hit those data caps real quick and someones going to pay for it.
I still have t-mobile trying to nickle and dime me for text messages I never authorized. This is the corporate mentality. Screw the consumer until the consumer goes somewhere else and then either merge with another company or go under.
Netflix was doomed one way or another; they simply accelerated it.
I had a Netflix 3 disk subscription forever, went to a 1 disk subscription, went to streaming only, and this article reminded me to cancel Netflix completely -- which I have just done.
When I first started using streaming it was very new and the selection sucked. I figured that the selection would get better over time, and I was wrong -- it seems to have actually gotten worse over time. Older catalog selections are dropping off and few new selections are being added. I no longer see the value in a Netlix subscription.
I suspect they've done this with the thinking that it's easier to sell off the ailing DVD side of your business if it's a physically seperate business.
Of course, they should have considered that when they first set up shop.
Perhaps that's one of the distinctions between 'having a good idea' and actually being 'visionary'.
Rather than a flat buyout in order to then shut them down, Hollywood somehow sweet talked the CEO into this with some pie in the sky future where Netflix will make it big. But that is just a bunch of hype to hook the sucker. Netflix could have been a serious threat to Hollywoods current way of doing bidness, but a big plus for consumers.
> They should offer Stream to Watch + buy DVD/BD physical Disk.
THIS is precisely the option that Amazon should offer. They should offer a stream + disk option where you get to watch stuff as it airs and then you get sent the disks when they come out.
They already do a sort of inverse of this where they give you streaming access to a show on disk while you are waiting for it to arrive by courier.
I reckon Lovefilm/Amazon must be attempting the same end - meltdown - using different tactics.
Their online selection has been pathetic for a while now, but it seems that their selection of DVDs is not being updated as you'd expect. Instead of seeing options to "pre-order" a title, you're offered the option to buy on Amazon.
I don't want to buy! I'm happy waiting a REASONABLE amount of time, then renting.
Why would I want to buy more films? I've already got a bunch sitting on a shelf gathering dust, not being watched. That's why I rent.
The fact that ratings and queues will not be integrated between the two sites will sharply drive a new wedge in.
Already I'm seeing most of my friends abandon the netflix website to use Instantwatcher.com or a dedicated app like netflix freak. These sites and apps provide much more functionality than the netflix site itself. Now there's a chance for new features- automatic queue balancing and ratings synchronization.
For those who want both services, I predict that more of them will switch to using an API or third party website. I don't know if netflix cares about people dodging their site, but I'm sure it will cut them out of some feedback loop.
...isn't JUST that they raised the price on 1 DVD+streaming by 60%, but that they are now completely separate subscriptions in every possible way. I had the DVD+streaming, but $15/mo for 1 DVD-at-a-time and occasional streaming viewing was way overpriced, especially since the streaming selection was poor, and is even worse now. So I went to 2-DVD for a slight price increase and dropped the streaming. But the worst part is, even if I kept my old plan with the price increase, I couldn't even search the two at the same time. I'd have to go to two SEPARATE websites to search two SEPARATE catalogs. Haven't two SEPARATE bills also means more work for me. Sure, these are major things, but when you compare to the fact that I was getting the same thing previously, in a much more convenient setup, it doesn't exactly leave me with a good taste in my mouth.
So, good going Netflix. I like how I woke up Monday morning thinking I just changed to a different Netflix plan, but in reality ended up canceling my Netflix subscription and starting a new "Qwikster" subscription. I'll just wait and see who buys Qwikster, since it's obvious that's what's going to happen...
I don't want to be the dog in the manger here but....
- Netflix' (s?) business model going forwards has the *potential* to be fantastic, but it could fall flat on its face, being so dependent on the bandwidth and download caps available to consumers. In Canada, for example, it has had to degrade the quality of films in order to fit within the ISPs derisory download caps per month (typically 1-5GB); if/ when ISPs get fed up of bearing the brunt of the traffic charges again, Netflix could well suffer from 'traffic shaping'.
- Yes, there is a master strategy: stop sending people DVDs and move them to online-only packages. In theory it results in much lower overheads and hence bigger profit. It's not rocket science, it's just that they completely forgot what it's like to be a consumer.
I was expecting a more detailed analysis of what this means for the industry, next steps etc, but I don't really see the substance of this piece. Sorry.
I don't see how this will end well for Netflix. It's fun to watch though: two Coke Zero moments in less than a year. MBA students will enjoy ripping this one apart in 10 years. They'll learn how an idiot CEO with no stock in the company managed to squander a decade of unbelievable goodwill with a one-two punch to his loyal customers' nuts. Reed can take his place in the hall of shame alongside Gerald Ratner.
In my house use both streaming and DVD. They complement each other nicely. Do their figures really suggest that we are in a minority? It's how everyone I know uses Netflix. The shitty streaming library practically forces it.
Up until my bill (first post-hike payment today, and it hurts), the only annoyance I had was Silverlight: we use a Mac Mini as an HTPC and f'ing Silverlight updates once a week with a stupid dialog box that pops up only when you hit play, instead of a polite background auto updater like every other program in the world. But I blamed Microsoft's cluelessness for that, not Netflix.
Now they're separating the companies. No integration, no single queue to manage, not even a promise they're going to add this. Two accounts to maintain. Two streams of emailed spam. Two sets of customer service. Two more opportunities for some cracker to steal my credit card details, and the worst company name I've heard since the first dot com boom.
Had they announced this by saying, "We've put all our DVDs on Instant Watch! The library is huge! But, if you still want DVDs, you have to get them from our sister company," then I think people would understand. As it is though, they've cocked it completely.
... you are missing the point. The reason Netflix‘s prices were so low was because of Hollywood being scared about BitTorrent. They figured out its better to rent their movies ar prices unheard of before, rather than not rent it at all because everyone is downloading it for free (btw they still made a profit from). Now that Hollywood is hoping to curb bittorrent with the PROTECT IP act, they are showing their real face (high rip-off prices are back).
What I really dont understand is people who buy or rent stuff in weird formats like itunes and UMD. Since when the public fell for the trap of buying the same movie over and over again? Just give me the DVD or Bluray, and i will convert it in the proper format for my cellphone, my PMP and PSP. And this is if a feel generous, and dont download it in DRM-free format for nothing from torrent. Com on guys, so them that PROTECT IP is useless and that if they want to reduce bittorrent downloads, they ‘ve got to be reasnable with their pricing.
Now for the same service (streaming and DVD mail) I have to deal with TWO companies instead of one. Would have made more sense to keep it all under NetFlix and have a bundle price for both DVD mail and streaming and price for individual services.
Fortunately, I didn't purchase the Roku player I was looking at a few weeks back. I think I will pass now. RebBox here I come . . .
I'm amazed that nobody is seeing this... it's clear that Netflix is setting up for an acquisition/merger by/with a major player; I'd guess Microsoft, Google, or Amazon. The company that's planning to acquire doesn't want to be burdened with the overhead of physical media distribution.
just offer a number of plans
- streaming only
- dvd only
- blueray only.
and then have the permutated bundles
stream + dvd
stream + dvd + bluray
dvd + bluray
stream + bluray
depending on what 'bits' are on you can browse a selection form the catalog.
no renaming needed, no splitting of the company , no splitting of the database.
it;s just option bits in the filter and the billing.
Brilliant no ?
So why didn't they do it ? i smell a rat.... like a shareholder rat.... netflix is the usps's largest customer. This shipping cost weighs on their net profit margin. By splitting off they can now claim 'netflix i xyz profitable' ,, quickster ' less'.. instant shareholder bonus .... and quickster will die in a few years as the entire media landscape is changing with the advent of web connected TV's and tablets with streaming capabilities..... the shine silver diks are going the way of vinyl... remeber the scen in BTTF2 where they had all the laserdiks wrapped up ready to throw in the mrFusion.... ( right about when marty gets his Nike shoes from the doc ... ) It ain't that far off you know.. 2015 ...
Netflix had agreements that allowed them to stream content from content suppliers. When these agreements were concluded a few years back streaming content was a minority activity. Its now common place so everyone+dog wants a piece of Netflx's pie. The content providers -- studios -- have the most leverage so they have been dropping content or otherwise forcing Netflix towards a pricing policy that puts the on-line revenue per subscriber on a par with cable revenue (Starz is the most recent). I daresay the ISPs also want to look at this business as well; my ISP would dearly like me to pay for their FiOS TV service but I'm getting 24MBits download speed from FiOS Internet so I don't really need a separate TV service. (The TV service would add $40-$70 per month to the bill; Netflix is trivial compared to that.)
Netflix are likely to get squeezed. The only thing they can do is pass the costs onto customers.
Lots of angst about making deals with studios and how much it's costing Netflix and using this as an excuse for their s*** streaming selection.
Why not simply offer the studios a certain fixed amount of money per hour of content viewed, like Apple offers a fixed amount per song, and see what happens.
The studios are making next-to-nothing for most of their back catalogs. It seems like they would quickly realize that they want to get something for their content vs. nothing.
Netflix could then balance the prices so the studios get paid and customers still only have to pay a flat rate, which is nice.
"It's potentially a huge, and positive change in the way we get stuff."
er, is it?
well, I mean, I guess, in theory. But it's the music and movie industries we're talking about, here. they'll find a way to stuff it up.
much like the software industry, who will happily tell you you paid for a license when it suits them ("stop selling that second hand copy, we only sold you a license!") then turn around the next second and tell you they sold you a physical copy if the circumstance is different ("you want a replacement disc? what did you do with the one we sold you?")
Interestingly, the down side is right there in the sidebar, in the story about the New New Edition of Star Wars. At least there are still original copies of the original cuts of the movies out there, on film, on video tapes, which people other than George Lucas indisputably own. He can stop publishing new copies of 'em, but he can't take away the old ones.
What if we all streamed everything and it was all perfectly DRMed? The New New Star Wars would be all you got. No-one would have a copy of the original. After a few decades - just as Lucas wants - few people would even remember (or, perhaps, believe) that Han shot first...
The Register 
Biting the hand that feeds IT
Copyright. All rights reserved © 1998–2024
