On March 30, Netflix announced a rather steep rate hike on customers who rent Blu-Rays. Not long ago, Netflix instituted a $1 surcharge for the privilege of having Blu-Ray titles shipped to customers in lieu of lower quality standard DVDs. As of April 27, the Blu-Ray surcharge will jump to $4 per month on the 3-at-a-time plan. Will this money grab by Netflix be the straw that breaks the camel’s back?
Netflix money grab: Blu-Ray surcharge is bad business
No one really wants to pay more for a service, however, a $1 surcharge as was first set forth by Netflix last fall wasn’t too much to ask. However, a $4 surcharge for renting Blu-Rays may just be the straw that breaks my back, as well as others. Common business sense should tell Netflix that profits should be reinvested to provide customers with the products they want and foisting a $4 Blu-Ray surcharge is simply bad business in this economy where consumers are looking at ways to cut costs at every corner. Blu-Ray won out over HD DVDs as the next generation video media. As more and more Americans migrate away from standard DVDs in favor of the far superior Blu-Ray technology, companies such as Netflix need to follow the trend. Having Blu-Ray movies to rent is simply a cost of doing business and meeting consumer demand. In fact, Netflix’ email stated, in part: “The number of Blu-ray titles has increased significantly and will continue to do so. As we buy more, you are able to choose from a rapidly expanding selection of Blu-ray titles.” This statement by Netflix indicates to me that Netflix is interesting in expanding its less than stellar Blu-Ray offerings at the expense of its loyal Blu-Ray customers. Engadget.com states that 10% of Netflix’ customers request Blu-Ray discs, which according to Netflix.com’s own statistics, that 10% is equal to over 1 Million consumers.
Will Blu-Ray Netflixers revolt against the blatant money grab?
The steep increase from $1 per month to $4 per month for the 3-at-a-time, arguably Netflix’ most popular plan, may cause consumer revolt. Engadget.com lists the graduated surcharge scale, which hits those who rent more per month with higher rates. No one is safe from the surcharge, as even the one-at-a-time option will be subject to at least $1 per month for the Blu-Ray option. The higher priced the plan is, the higher the Blu-Ray surcharge will be. The question is whether or not the increased Blu-Ray fee structure will be met with customer ire or whether Blu-Ray loyalists will accept the new fees without a fuss. In my opinion, Netflix does not have an extensive Blu-Ray library and many older titles are not even available on Blu-Ray. One wonders if the price jump will truly mean a far more extensive library of Blu-Ray titles to choose from or if this increased fee is just a money grab by Netflix? Netflix customers who are appalled by the new surcharge can access their account and remove their Blu-Ray preferences before the new surcharge rates go into effect on April 27.
First hand experience as a Netflix customer