holy stupid management decisions, Netflix!

[Russ Smith]

What a colossally dumb decision that was to raise prices and separate the dvd and streaming.

July they were at 300. They closed today at 118 and then announced they'd lost even more subscribers than expected and forecasts were for even more to abandon them going forward. Stock fell 36 bucks or 26% afterhours.

From 304 to 86.74 in that time frame.

 

[conraddobler]

Ah the puts could have been epic.

You can't find stupid like that just everyday, you have to hand it to them.

 

[Divide Et Impera]

Arrogance. I'm a Netflix subscriber, but I am among the MULTITUDE of subscribers who dropped the +1 feature. They lost $2 revenue per month from me and the many like me. I wrote a post when this decision was made a few months ago that Netflix was going to have to upsell one +1 subscriber to the new rate just to offset every three that drop (1:3 = +$6-$2, -$2, -$2)). They couldn't do that and decoupling the DVD service was colossally dumb.

They had better get some good movie contracts to get some people back....

 

[Russ Smith]

Arrogance. I'm a Netflix subscriber, but I am among the MULTITUDE of subscribers who dropped the +1 feature. They lost $2 revenue per month from me and the many like me. I wrote a post when this decision was made a few months ago that Netflix was going to have to upsell one +1 subscriber to the new rate just to offset every three that drop (1:3 = +$6-$2, -$2, -$2)). They couldn't do that and decoupling the DVD service was colossally dumb.

They had better get some good movie contracts to get some people back....

I dropped too although at the time I was only getting DVD's, I was allowed to get streaming videos if I wanted. My problem was my rate went up about 40% under the new plan, and I no longer could get streaming without adding that separately. so they were telling us they had to increase rates because it had become too expensive(because of streaming) but people who weren't even using streaming saw their rates jump too.

I would often go one movie a month tops, sometimes longer so it's become cheaper for me to rent one a month on On Demand.

I get that they needed to raise prices but they finally admitted that they did it too much and too fast, they didn't figure out what the changes really meant to consumers until it was too late.

 

[Gaddabout]

They lost their Starz contract (in Jan. 2012), so unless they land someone who can give them decent movies to stream, I see no reason to go back to them.

 

[conraddobler]

Modern internet business, even failures occur faster now.

It's pretty interesting to see someone take a gun out load it and take careful aim at their own foot and fire.

 

[Russ Smith]

Now down 35% since Monday closed at 77 yesterday.

In the high 75's today so down again.

 

[JS22]

I was never too upset with the change because it was a way for them to (potentially) get some more revenue, which would help them get more contracts and a larger streaming selection.

Unfortunately for them it seems to have totally backfired.

 

[Russ Smith]

I was never too upset with the change because it was a way for them to (potentially) get some more revenue, which would help them get more contracts and a larger streaming selection.

Unfortunately for them it seems to have totally backfired.

There's an old Steve Martin album(see I said old) where he has a joke about how he's going to do one more show and retire. I forget the exact numbers but the idea is if you charge a REALLY high price per ticket, sell out, it's "one show, goodbye."

I think Netflix should have listened to that bit before they made their decision. They now admit the pricing structure is where they need to be, but they should have phased it in, they did it too quickly and the shock is what made people go no way.

I think banks are seeing it now too with the debit card fees stuff, we saw a story on tv yesterday people are flocking to credit unions. In an effort to raise more capital, banks shot themselves in the foot and are going to have even less money because of this.

In this economy you have to think long and hard before you raise the cost of something.

 

[BigRedRage]

i like it, no more paying for DVDs i dont use and more money to buy streaming agreements

 

[Brian in Mesa]

Meh. It might be affecting them, but it did not affect me at all. We only have the streaming. No price change at all and if, as BRR said, it leads to better streaming choices - more power to them. The timing was bad, but otherwise...kudos!!

 

[conraddobler]

Meh. It might be affecting them, but it did not affect me at all. We only have the streaming. No price change at all and if, as BRR said, it leads to better streaming choices - more power to them. The timing was bad, but otherwise...kudos!!

Didn't it coincide though with losing the Starz agreement?

IMO what they did is massively blew it, now they let a lot of competitors off the turf here, blew a massive lead they had in customer base and allowed themselves to be hounded by new upstarts.

They have a huge problem IMO comming in terms of ISP's wanting to take money out of their hides too, they run a business model on the back of tons of unused and "unpaid for" bandwidth that the ISP's are not just going to keep absorbing for them.

In effect they are going to blow the all you can eat model of bandwidth for everyone.