Netflix Price Rise Irks Subscribers
Monday, July 18, 2011 at 12:59 am
The recent hike in subscription charges for Netflix has irked many subscribers. The price changes that add up to $6 to the monthly bills of subscribers for unlimited streaming video and DVD rentals may have far reaching consequences for Netflix and its operations. The changes will be in place for all new members and from September 1 for the current subscribers.
Netflix fears that the internet service providers will hamper their business by placing data caps on online entertainment. It is retreating from its mail order DVD business and focusing on subscribers who only want to subscribe to DVDs.
Jessie Becker, Netflix's Vice President of Marketing says that they are confident that most of its 23 million subscriber base will still need the DVDs and hence they have created a management team for DVDs by mail.
This step by Netflix is to reduce the DVD only plans which prove to be huge weight on the bottom line of the company in terms of postage, inventory and handling. Streaming is cheaper and hence could change the entire module of operations.
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