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The last time I blogged about Netflix, it was over a price increase. And once again, I blog about Netflix as they raise their prices.

On Tuesday, Netflix announced their new pricing and plan structures. Instead of continuing to offer a combo plan of both DVD rentals and Instant Watch streaming, they have separated the services into two plans – DVD only and streaming only. Here’s a summary of the new plans:

  • Streaming only (unlimited views): $7.99
  • 1 DVDs out at a time (unlimited rentals): $7.99
  • 2 DVDs out at a time (unlimited rentals): $11.99
  • 3 DVDs out at a time (unlimited rentals): $15.99
  • 4 DVDs out at a time (unlimited rentals): $21.99
  • 5 DVDs out at a time (unlimited rentals): $27.99
  • 6 DVDs out at a time (unlimited rentals): $32.99
  • 7 DVDs out at a time (unlimited rentals): $37.99
  • 8 DVDs out at a time (unlimited rentals): $43.99

The above prices are billed to a credit card you have on file with Netflix once a month. You can combine streaming and DVD rental plans by simply adding $7.99 to each of the above plans.

Before The Increase

I am currently on the 1 DVD out at a time plus streaming plan for $9.99 a month plus local sales tax [I get billed $10.62 every month on my credit card] This was only $7.99 for the 1 DVD out plan, but then they combined the streaming with it, which was nice. But in hindsight, it got me used to getting more for less. And so here is where the outrage and rub down starts.

Netflix has done this before with the Blu-Ray… give you it for free for a while, get you hooked on it and used to it, then start charging for it. While this is a great way to promote a new service, it’s a terrible way to deal with the price increase. It’s almost a bait and switch, on a media viewing level. Get you in for the cheap stuff, then once you get it and enjoy it, raise the price on you. No different than many other businesses, but for Netflix, the darling of the tech and consumer world, they take it on the chin rather harshly.

Netflix gives the reason for this latest increase in plans as “Given the long life we think DVDs by mail will have, treating DVDs as a $2 add on to our unlimited streaming plan neither makes great financial sense nor satisfies people who just want DVDs” And I happen to agree. The extra $2 a month for unlimited DVD rentals was a killer deal, just not financially viable for the long term.

Like Coasters

netflix envelopes
The constant scene on our TV stand (this was when we had the 2 DVD plan)

Which brings me to my decision here. Do I continue the 1 DVD out plan with streaming and have my bill go up $6 a month? I see those red envelopes on my TV stand often – sometimes there for weeks at a time and it makes me think about how many DVDs do I watch. The last DVD, the movie Black Swan, sat on the stand for 3 weeks before I watched it last night. Meanwhile, I can watch a streaming movie or TV show on my laptop, Sony PS3 or iPad whenever.


netflix limited plans
Too limited for me

Ok, so if these price increases are too much, Netflix does still have too very limited plans for those who really don’t watch a lot of movies each month. As per the above graphic, they don’t give you much, but you also are not paying much, either. Neither of these plans interest me in the least, but to some they may be a great fit for the budget minded.

Streaming Stays

To summarize and given my history and patterns, it’s pretty much been decided that I’m going to downsize my Netflix plan to just the $7.99 a month unlimited streaming. For new release DVDs, Redbox has been finding it’s way into my life. I get free rental codes once a month and at $1 a day, I find that I don’t let the DVD sit around for more than just a few hours before watching it. Netflix’s lack of late charges has made me a lazy DVD viewer. Redbox may retrain me to be more prompt. Plus, I could add the DVD rental to my account anytime if I wanted it for a month or two, not affecting my streaming plan.

I know Ren has chimed in on his thoughts on the Netflix price hikes. How about anyone else? How do you use Netflix? Or do you use Redbox? Or maybe you are still with *shudder* Blockbuster. Speak up, readers.