Netflix hikes prices, announces DVD-only plan

July 12, 2011 By Andrew Couts

Netflix has announced that it will no longer offer a plan that includes both DVD rental and unlimited streaming.

Netflix announced today that it will do away with any plan that offers both DVD rentals and unlimited streaming, starting in September. To get both services, customers will have to pay $7.99 for an unlimited streaming plan, and at least another $7.99 for the least expensive DVD rental plan. That means both services will now cost subscribers $15.98 per month, a significant increase from the $9.99 they have been paying for the same service.

Customers will now be able to subscribe to DVD-only plans, which will start at $7.99 per month for the one DVD at-a-time option, or $11.99 per month for two DVDs at-a-time plan, Netflix announced. “These plans offer our lowest prices ever for unlimited DVDs,” writes Jessie Becker on the Netflix blog. He adds: “By offering our lowest prices ever, we hope to provide great value to our current and future DVDs by mail members.”

Unlimited streaming plans, which also cost $7.99 per month, will remain the same.

Netflix is trying desperately hard to sell this change as a win for its customers. According to Becker, the company did not anticipate that many users would want to keep receiving physical DVDs after they announced the $7.99 unlimited streaming plan last November. So, rather than have DVD-only plans, they simply made the DVD option a $2 add-on to the unlimited streaming service.

Now, however, they believe that DVDs by mail has a “long life” ahead of it, so “treating DVDs as a $2 add on to our unlimited streaming plan neither makes great financial sense nor satisfies people who just want DVDs.” This, says Becker, is why they made the changes. They’ve even started a whole new “separate and distinct management team” that will be “solely focused on DVDs by mail,” Becker says.

Needless to say, Netflix users aren’t happy — or, at least, the frothy hoard that is commenting on the Netflix blog announcement isn’t.

“This is a horrible deal for current customers,” says commenter Todd Hayward. “You’re going to be losing a lot of business with this decision.”

What do you think of the change? Does this affect whether you’ll keep your Netflix subscription? Let us know in the comments.

Showing 37 comments

Robert at 2:58am 14th July 2011 This is rudicilous I already have the 3 DVDs and unlimited streaming. I use to only have the 9.99$ plan but I found out that you can't stream Netflix on two devices at a time with that plan, so I had to upgrade because 4 people at my house stream all the time through iPods and 2 xbox's and now there going to raise the price? How ridiculous they dont even have that good of a selection I like to watch anime and the top 4 animes on there are not even in English bleach, naruto, inuyasha and death note. Were canceling Netflix now
dang206 at 10:29pm 12th July 2011 At the previous cost, I had no problems being a subscriber to Netflix (streaming + dvd + 1 blu-ray). With the price hike, screw it. I don't use it enough to justify the cost anymore. I'd rather find an alternative, and I truely believe the market for streaming only service is ripe for the taking.
Nancy Wilkens at 5:23am 13th July 2011 That's terrible. At least one DVD that I've received was damaged, and I had to send it back to get another one... It won't be long before there is a downgrade and / or a cancellation of Netflix at my house. What were they thinking? that they want to go out of business ??? What then, do I do with my new Roku box?
Daniel J Hauck at 3:09am 13th July 2011 I'm Cancelling!
Andre Dyer at 1:56am 13th July 2011 Lol @ Chris Johnson. @ Andrew Couts: agreed. Additionally, Netflix transition into streaming would have been successful if we actually had more streaming selections. The streaming selections are very limited, my queue (DVD vs Instant) says it all, large disparity btwn them. It's a really bad gamble!
Bob Rocco at 6:21pm 12th July 2011 I recently subscribed to Netflix. I was a Blockbuster Online subscriber for many years; Blockbuster’s unlimited in-store exchanges and free movie a month coupon gave it an edge over Netflix. Blockbuster’s bankruptcy forced many of their stores to close including the 2 closest to me, so the unlimited store exchange was no longer as convenient, I thought to give Netflix a try Since Netflix offered unlimited streaming as well as DVD delivery. Well, Netflix is more expensive than Blockbuster, Netflix charges you $2 a month more for Blu-ray while Blockbuster is no extra charge, and the selection of titles for streaming is very limited with Netflix. I found a Blockbuster store close to a regular place I travel so I was thinking of cancelling Netflix. Now, with them jacking up their prices, I am certainly cancelling and going back to Blockbuster. I will not miss the streaming and will save a few bucks a month even if I just kept the Netflix DVD only plan.
Rusty Shackleford at 5:33pm 12th July 2011 This price hike is obnoxious, but $15 for all-you-can stream and one DVD out at a time is still nowhere near as obnoxious as basic cable. (And for those complaining about the content on Netflix streaming, tell me TNT and Comedy Central reruns are any better.) My bet: Netflix will launch a new ad-supported streaming option at the old price, and this is just a ploy to make swallowing the ads go down a little better. Hulu Plus is already there.
jeremy at 5:12pm 12th July 2011 Cancelling both, netflix will lose a lot of people with this greedy move, I had the 9.99 plan. I streamed some but the streaming selection is horrible and low quality. And with only getting 1 disc out at a time for 8 bucks ill come out about the same going a half mile down the road to the redbox and I won't have to wait a couple of days for the movie to come. Netflix was already close to the "too expensive for what you get" line, and this move justmoved them WAY passed them.
Russel Williams at 11:48pm 12th July 2011 Dumb move Netflix
Lindsworth Horatio Deer at 11:33pm 12th July 2011 they are trying to grandfather people away from DVD to Netflix streaming!!!! Clever.........its cheaper to stream than to send out copies of original DVD. Plus Streaming makes piracy difficult!!!http://mythoughtsontechnologyandjamaica.blogspot.com/2011/04/netflix-death-of-blu-ray-rise-of.html
Tonio Johnson at 11:27pm 12th July 2011 Im staying myself. Personally it's still cheaper than the basic service of satellite with direct tv with one of the movie packages. The price hike does suck, but there really aren't to many alternatives and it still beats paying for cable and having nothing on.
Chris Johnson at 11:26pm 12th July 2011 What this is actually saying:"Dear customers,Because 90% of our contracts are going to be renegotiated in 2012, we know that many of the companies that provide us content are going to ask for ten times more then what we currently pay to house their product. In addition, we now have mass amounts of competition from companies that have billions of dollars more cash on hand so they can bury us in bidding wars. We predict that Hulu will be acquired by a tech giant which will dominate the world of streaming (and if Amazon acquires them, we're really screwed) and so to appease our shareholders, we will need raise our rates by 400% in 2013 so we don't want to shock our customers when it's $35.00 a month for one DVD and limited movie streaming.Please don't make us go the way of Blockbuster.Sincerely, Netflix."
Marissa Carr at 11:13pm 12th July 2011 I'm staying with Netflix
Eric Peterson at 4:07pm 12th July 2011 Although I used the dvds more when I first signed up, I haven't used them much lately. I have plenty in my streaming list, so I'll be cancelling the dvd side.
Matthew Louis at 11:05pm 12th July 2011 i love you netflix and ill never leave you
Jasper Walker at 11:03pm 12th July 2011 -1
Andrew Couts at 11:01pm 12th July 2011 @Andre Dyer - That's definitely the quote to remember. But the key point here, if you ask me, is the doesn't "make financial sense" bit. Essentially, this means that users didn't make the switch to streaming in the way Netflix expected. They were losing money on the DVD subscriptions, and they can simply no longer afford to keep the price as low as they had it. In other words, Netflix gambled and lost.
Cin Elizabeth at 10:59pm 12th July 2011 canceling my membership
Joe Gomez at 10:54pm 12th July 2011 ddos
Joel Geist at 10:53pm 12th July 2011 F Netflix. This is going to cost them a LOT of customers
Andre Dyer at 10:51pm 12th July 2011 Remember this quote ppl: “treating DVDs as a $2 add on to our unlimited streaming plan neither makes great financial sense nor satisfies people who just want DVDs.” This, says Becker". This Becker person will be on chopping block in a few months after all the cancellations.
Andre Dyer at 10:50pm 12th July 2011 I'm not sure which Netflix user will like this. DVD and Streaming WORKS for us, so why mess with it? Blockbuster's spiral downturn started when they started playing around with late fees, followed by angered customers. This pricing model by Netflix will have a significant negative effect. Once the cancellations start piling up, they'll reverse this pricing.
Carl Sproles at 10:44pm 12th July 2011 No more netflix for me!
Bernd Currie at 10:43pm 12th July 2011 Good bye Netflick
Paul Baterina at 10:41pm 12th July 2011 NOOO!!!!
Mike Kodrich at 10:39pm 12th July 2011 Well this blows!!! The only reason I bought the second blue ray player was for it's netflix option and now I will be canceling netflix!
Jessica Trau at 10:37pm 12th July 2011 This is BULLSHIT! Now IF Netflix had a lot more in their stream service I might be fine with it. HOWEVER there's still a LOT of their content that is DVD ONLY! Even NEWER shows such as Big Bang Theory is DVD only! To say this is an "Upgrade" is nothing more then BAIT AND SWITCH! "Oh sure look at how much you're saving, oh wait you're actually paying more for the same service! OPS!"
Autumn Lokerson at 10:37pm 12th July 2011 Ew really? Not cool. Guess it's time to cancel my membership.
Sakura Kaneshiro at 10:36pm 12th July 2011 i double with what michael buff joseph said !!!!! : /
Michael Buff Joseph at 10:32pm 12th July 2011 Wtf
Ian Bell at 3:32pm 12th July 2011 I'm willing to bet that Netflix lowers their prices again. They are getting sooo much bad press today over this. With their premium partnerships like Starz all ending, why would people pay more for less good content? Plus most of it is not even in HD.
chris at 3:10pm 12th July 2011 Streaming is not worth that...i will keep the discs to see how that goes and how it affects the wallet...
PeepingTom at 1:31pm 12th July 2011 I had the $9.99 plan. They made points with me recently when they FINALLY released the Android streaming client, but lost out with the pricing increase. I received the email this afternoon and promptly cancelled. Buh-bye Netflix. Read about little events they hold for shareholders where they take software questions from supposed online shareholders and give little useful information. It doesn't look good for them going forward.
Ian Bell at 1:20pm 12th July 2011 Ugh Looks like Cable and video on demand will win out in the long run. Netflix was a good alternative, but the truth is that their streaming videos sucks. There are few good shows and the video quality is crap.
markb53 at 1:15pm 12th July 2011 Since only about 10% of what I want to watch on Netflix is available for streaming, converting to a streaming only plan is not a good option. Staying where I am will increase my my monthly Netflix cost by more than 50%. I will have to consider my options and decide whether to pay the increase or cancel my Netflix account.
andrew at 12:58pm 12th July 2011 This is BS..... I read the article, then literally 2 minutes later i get an e-mail telling me that my plan is going to jump from $9.99 to $15.98. Yup, I've already changed my plan down to the streaming only option. I really don't like getting discs in the mail, but Netflix still needs to work on it's streaming library or else i'll be jumping to another alternative.
1. jakep_82 at 1:10pm 12th July 2011 I have the 2 DVD plan that I split with my girlfriend. It's jumping from $18 to $23. That combined with Hulu Plus is putting us dangerously close to the cost of basic cable which we've been avoiding. This change will likely cause us to downgrade to streaming only or perhaps cancel altogether.