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Effective Immediately, Netflix Increases Prices 60%
Yesterday, Cinema Blend writer Leslie Kasperowicz discussed the troubles Netflix has begun facing since Sony titles were pulled from the service last month. With rising competition and contracts with many of the other major film companies near duration, Netflix needed to figure out a way to remain dominant and still make money. It didn't take long for Netflix to figure out a solution: one that sends the consumer into deep waters with no life jackets.
When Netflix changes its tune, it doesn't do so subtly. The company announced Tuesday the minimum package price will hike up to $15.99. Alternatively, streaming media or 1-at-a-time DVDs will be offered separately for $7.99 a month. According to Deadline, the price change is effective immediately for new customers and will reach existing customers as of September 1.
It's likely we can thank the problems with Sony for such a quick price change. But let's be honest, the increase itself isn't shocking. Companies lowball people to get them invested and then hike up the prices all the time. The easiest way to make more money is to charge more. Even my water company knows this, and will be increasing charges 30% by 2012. However, unlike Netflix, the water company has the grace to make the increases hike up slowly, so it doesn't seem like such a calamity when consumers are faced with double or higher rates. The fact that Netflix has changed its tune so quickly means they felt cornered enough to act without precedent. Only time will tell if a scared company can remain an efficient company.
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