Netflix Shares Close -2.8% Following Analyst Downgrade

COMMENTS (20)

• I heard a very good theory or maybe its fact on why Netflix raised their prices. Hollywood companies jacked up the licensing fees on Netflix so Netflix had no no choice but to increase their monthly fees. Hollywood is angry with the streaming company so they want to teach them a lesson.

  Comment by Jerry — Monday July 18, 2011 @ 1:44pm EDT  Reply to this post

  • Hollywood really needs to get their heads out of their asses and realize that they can’t force people away from streaming services. They make a lot less money on streaming than on people buying DVDs I’d bet, but people want streaming, and that’s what they’ll pay for. They should embrace it.

    Comment by Jamie — Monday July 18, 2011 @ 1:55pm EDT  Reply to this post

  • And now Netflix will teach Hollywood a lesson. The fee hike forces people to choose between instant viewing and DVD’s. Most people will choose instant viewing because they know they can also stream any movie at any time on illegal sites. Netflix: Get on board with streaming or watch everyone jump to pirating.

    Your turn studios.

    Comment by working actor #274 — Monday July 18, 2011 @ 2:01pm EDT  Reply to this post

• Blockbuster tried that once too. Guess who won?

  Comment by Some Dude — Monday July 18, 2011 @ 1:55pm EDT  Reply to this post

• Jerry, are you referring to the companies that spend a ton of money to produce, advertise, and distribute the films that Netflix then streams for their 7 billion customers at $8 per customer?

  Comment by JulesPDX — Monday July 18, 2011 @ 2:00pm EDT  Reply to this post

  • Yes but I also understand that its a business.

    Comment by Jerry — Monday July 18, 2011 @ 3:36pm EDT  Reply to this post

• It may be true that the license holders raised their prices in order to get their share of VOD profit. But Netflix’s subscription increase has been implicit in their business model since inception.

  Comment by DYG — Monday July 18, 2011 @ 2:06pm EDT  Reply to this post

• Streaming started acting up yesterday mid-p.m. actually. Couldn’t get anything through my BD player and only partial service through my Xbox.

  The service has been reliable for a long time so I’m not going to panic over this mishap but their timing couldn’t have been worse. I’m switching to their “streaming” only service comes August so I want to make sure that it

  Comment by Netflixdon'tdroptheball — Monday July 18, 2011 @ 2:09pm EDT  Reply to this post

• For a few years now, Netflix continues to make decisions that are very anti-customer, while supplying little benefit to compensate. That’s just been my personal experience. I loved the “community” aspect of the site, with having friends, sharing recommendations, etc. They gradually did away with a lot of what I liked about them. And perhaps what I appreciated most no longer made economic sense for them and didn’t fit into any future business models. ‘

  But, the fact remains, they have become nothing but a provider of product now, which isn’t anything special. Although I’m still a subscriber, all it will take now is for another company who provides the same service plus a small appealing bonus, or a company who provides the service for slightly less money, or a company who provides more appealing product, and I’m gone.

  I guess what I’m saying is that it’s sad to want to be loyal to something in the marketplace, but no one interested in that allegiance. But, I guess that’s capitalism.

  Comment by Cinesnatch — Monday July 18, 2011 @ 2:12pm EDT  Reply to this post

  • Cinesnatch just read my mind.

    Comment by Rip — Monday July 18, 2011 @ 3:59pm EDT  Reply to this post

  • signed.

    Comment by agreed — Monday July 18, 2011 @ 8:37pm EDT  Reply to this post

• I’ve heard that as well. But I’m so tired of hearing everyone crying about the raising of the prices. Yes, when a company blindsides you with a price hike, it’s understandable to be angry. But Netflix was charging Nine dollars to get free streaming, and unlimited DVD’s one at a time. Customers, me included, were getting away with content murder. Remember the days you would go to Blockbuster, rent two movies for ten bucks, then return them late and pay another ten bucks. Those days are over. Netflix had every right to raise their rates, and yes, it’s because their contracts for licensing fees were going way up. So everyone stop whining and pay the fifteen bucks and be happy that’s all you’re paying.

  Comment by netflizzy — Monday July 18, 2011 @ 2:12pm EDT  Reply to this post

  • Agreed netflizzy,

    i’m by no means associated with netflix except that i am a longtime satisfied customer. when’s the last time you were offered a $25 cable package (which is the most anyone has to pay for netflix).

    all this has been terribly overblown. it’s getting ridiculous.

    and contrary to some people’s belief, not everyone wants to stream everything over the internet — so get that out your skulls.

    Comment by Terrence — Monday July 18, 2011 @ 7:22pm EDT  Reply to this post

• Hard to believe that Netflix will be able bring in any significant amount of new users in the next few months, then the PR and social media discussion is all about price hikes and customer backlash. Gotta figure any new sign ups would simply counteract those who are dropping or scaling back their service.

  That said, in about 3 month the backlash will be old new, and people will realize that even at 60% higher costs, Netflix is still the best option out there and the customers will start coming back.

  Comment by No One of Consequence — Monday July 18, 2011 @ 2:17pm EDT  Reply to this post

• There is no way in hell they can justify the price increase without providing an additional service or at the very least get rid of the 30 day window on dvd rentals. They think they are hurting now wait till Sep 1 when half their subscribers cancel. Even if they feel they will be back in 3 months it will be difficult to pay their employees and pay dividends

  Comment by steve — Monday July 18, 2011 @ 3:27pm EDT  Reply to this post

• My theory, and this is probably not true but would be great if it was, is that Netflix jacked their prices so that they could get massive amounts of publicity based on the move. It made the front page of newspapers across the country, greatly expanding their brand recognition. And though the 60% hike might seem drastic to existing customers, hundreds of thousands, if not millions of new customers are hearing about these services for the first time and they see that the cost for streaming unlimited movies is only $8 (the only thing that stayed the same) … and that… the digital service, is the business Netflix is really trying to expand while fazing out their DVD/Blu-ray service.

  Comment by Matt — Monday July 18, 2011 @ 3:36pm EDT  Reply to this post

• I switched to the streaming only myself, but I really didn’t watch many of the dvds. Definitely prefer the streaming since I don’t have a whole lot of time to watch TV anyway.

  Comment by Anonymous — Monday July 18, 2011 @ 3:58pm EDT  Reply to this post

• I will be cancelling my Netflix account completely as a direct result of this price hike. I will instead rent on-demand movies from Amazon and watch free content on Hulu (what there is of the free content).

  Netflix just lost another customer.

  Comment by Teleplau — Monday July 18, 2011 @ 5:11pm EDT  Reply to this post

• I canceled this morning. As any economist will tell you, a company can attempt to set a price for its goods or services, but if the market won’t support it, than the price will have to fall to what the market will agree to pay. If enough people cancel, Netflix will have to lower their price.

  And if they don’t, I just saved $16 a month. Hell, I don’t have enough time to watch all the shows I tivo now!

  Comment by Itsdawhiz — Monday July 18, 2011 @ 5:37pm EDT  Reply to this post

• Amen!

  Comment by Biz — Tuesday July 19, 2011 @ 8:36am EDT  Reply to this post