I’ve been a really long subscriber to Netflix and I love them. They innovated the DVD by mail industry and relieved us all the sorry errand of going to Blockbuster. The number of movies they have available is boundless and the web interface for the service is second to none.
I don’t know what happened to Netflix but they have lost their ever loving minds in the past few weeks. First, without warning, they drop the bomb that they are going to effectively more than double the price for the same service we have always been enjoying. I understand price increases, sure, I also understand highway robbery. Customers universally flipped out and today an email direct from the CEO says he is sorry the communication didn’t go so well. He is not sorry about anything else and he’d do it all again, but they did not communicate well enough. The classic non-apology apology.
Let’s break it down because it’s really quite simple.
Netflix wants to and needs to move to a streaming only service, no more DVD’s. You don’t have to convince me of this and I am 100% behind this move. There is nothing more I would love more than to have a Netflix streaming only service. Mailing DVD’s back and forth in the mail is archaic and slow. BUT there is one big, big problem with all this. The selection of movies available on Netflix streaming is horrible. It doesn’t even come close to what is available on DVD. Now why would I move over to your streaming service for the same money for a massively reduced amount of content? That just doesn’t make sense. There is a fantastic Mashable article that explains this as well as anything I have read. My favorite line from the article “…you’re about to get whipped by the Long Tail. Good luck with that.” If you don’t know, you need to read the book The Long Tail immediately. It is still one of the best primers on the economics of the Internet.
It has actually been two days since I started writing this post and I will give you the update, I officially did cancel my Netflix account just a moment ago. One of the only effective things I can do is vote with my feet and that’s what I have done.
I will be using Amazon.com and iTunes for my replacement. Amazon remarkably has a fantastic library of movies and content available, far, far greater than Netflix streaming. The only difference is you must pay for each item rather than the subscription model. You about break even if you only watch about two movies per month. Heck, even if you watch three, it’s only a little more and you do have the big library available. I say it’s well worth it. Netflix will have to get to at least 75% of their DVD library available on streaming before I will think about coming back to them. By then, someone else may have come up with an alternative subscription model with the content to match. Netflix has made themselves so vulnerable I think they are about to have their lunch eaten.