How Netflix Made a Terrible Mistake

Netflix is a great idea. And how they do that rapid turnaround of DVDs is still beyond me.

But this time they went too far.

Yesterday, Netflix announced they were changing their rates. Oddly, in one of their first mistakes, I got the email last night a good 16 hours after I’d already picked up the news via Twitter. My email said:

We are separating unlimited DVDs by mail and unlimited streaming into two separate plans to better reflect the costs of each. Now our members have a choice: a streaming only plan, a DVD only plan, or both.

Your current $9.99 a month membership for unlimited streaming and unlimited DVDs will be split into 2 distinct plans:

Plan 1: Unlimited Streaming (no DVDs) for $7.99 a month
Plan 2: Unlimited DVDs, 1 out at-a-time (no streaming) for $7.99 a month

That’s an almost doubling of the price I currently pay.

Look, I understand the need to raise prices. But by this much and without warning?

Dear Netflix is still trending on Twitter this morning. I couldn’t keep up with the comments last night. Thousands of subsribers are angry.

Last night my last tweet said:

Dear #Netflix, you are the “New Coke” of the 21st Century. #marketingfail

And it’s true. Had they handled it a little better, maybe the reaction wouldn’t be as strong.

Last time I checked, over 26,000 people had commented on the Netflix Facebook page. If the comments were similar to Twitter, they weren’t kind.

Will Netflix take a step back and reconsider? I don’t know. But based on the comments now trending, they’ll lose a significant percentage of their customers if they don’t.

I don’t know yet if I’ll be one to walk away. I’d need another option. I do like the convenience. And while my son is away at college, he can use the streaming option in his dorm room. It’s also an added bonus that we can stream movies through the Wii and not just on the computer.

But frankly, the streaming selection is a little stinky. Many of the top movies are DVD only. And the streaming selection doesn’t grow, it rotates. So that one week you might be in the midst of a series and that series just might not be there next week.

If Netflix wants to charge more that’s one of the problems they’re going to have to fix.