Netflix to split DVD business? Not any more!
- Thread starter rockymtnhigh
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No surprise. I knew they were going to do this.
I am just sticking with the streaming only plan anyway.
I am just sticking with the streaming only plan anyway.
If Dish wanted to do something really cool, they could offer more options for streaming via the STB. I've used it a few times, but the selection is not very expansive...
To anyone who has a memory, this move is not news except for the timing. Many of you might recall I mentioned this was Reed Hasting's ( Netflix CEO) goal in the long run. We just didn't know when. Back last winter he stated that soon the DVD rental by mail will need to be replaced with streaming and will become the dominant service at Netflix. I believe in the future and progress. Continuing mail order DVD rentals is a dying business concept with no future at the costs Netflix charges. It will radically increase in cost to Netflix to execute primarily due to increase shipping. Increase in cost to subscribers due to fewer and fewer DVD's cycled per month due to the planned reduction of US mail delivery. Hastings knows this and is planning now to fix this by moving to a better technology for the service. Yet, he is called by one sat guy member as stupid. I guess that individual must still have dialup internet or has never used high speed broadband video HD streaming.
What I see happening is that in the near future, the Quickster will suffer huge margin losses for the business, Netflix which will own it as a wholly owned subsidiary. It will try to spin it off as a niche business with no growth potential or it will simply shut it down. The move is toward streaming, everywhere. Face it, if you love DVD mail order your're screwed because it will go away like VHS tape rentals. Streaming is not a dead end to quality either. It will continue to improve, both on the distribution end as well as your ISP end. Everyone in the industry is working toward that goal, not to figuring out how to lower mail order prices.
In the short term, Netflix has made a bold move that is scaring the FUD people now, but in a year these FUD people will see the benefit of a low cost way to get movies and video entertainment content at the lowest cost.
Also, as far as the growth of Netflix is concerned, the business has recently expanded to 43 new countries for streaming service. No figures are public yet for this initial expansion. While Blockbuster and Hulu are small US based operations, Only Netflix is poised to be a global streaming media service with no real competition. It is this reason I have moved my investment position on Netflix to Long Investment as opposed to Trading it every few weeks.
What I see happening is that in the near future, the Quickster will suffer huge margin losses for the business, Netflix which will own it as a wholly owned subsidiary. It will try to spin it off as a niche business with no growth potential or it will simply shut it down. The move is toward streaming, everywhere. Face it, if you love DVD mail order your're screwed because it will go away like VHS tape rentals. Streaming is not a dead end to quality either. It will continue to improve, both on the distribution end as well as your ISP end. Everyone in the industry is working toward that goal, not to figuring out how to lower mail order prices.
In the short term, Netflix has made a bold move that is scaring the FUD people now, but in a year these FUD people will see the benefit of a low cost way to get movies and video entertainment content at the lowest cost.
Also, as far as the growth of Netflix is concerned, the business has recently expanded to 43 new countries for streaming service. No figures are public yet for this initial expansion. While Blockbuster and Hulu are small US based operations, Only Netflix is poised to be a global streaming media service with no real competition. It is this reason I have moved my investment position on Netflix to Long Investment as opposed to Trading it every few weeks.
i agree most in what you say don but netflix need to have everything available on streaming as they have on dvds if they want more people streaming 
what they have on streaming sucks and i cancelled because of it and was going to go back but their price hike will keep me away from netflix i hope blockbuster (owned by dish) and hulu owned maybe by dish soon they are in the 3 for hulu and they will give netflix a run for its money and make for available for streaming
what they have on streaming sucks and i cancelled because of it and was going to go back but their price hike will keep me away from netflix i hope blockbuster (owned by dish) and hulu owned maybe by dish soon they are in the 3 for hulu and they will give netflix a run for its money and make for available for streaming 
I wonder what the impact of losing Starz will also have on Netflix's streaming subscription base.
Another that will hurt Netflix (I mean Qwikster) will be if the post office gets their way and we go to a 5 day deliver schedule.
I personally kept the streaming because you can use it as much as you like and you can watch more than one movie unlike only having one dvd. Also I figured when I cancelled they lost $9.99 that they thought they'd get extra off of me. ($7.99 unlimited DVD + $2.00 Blueray)
I personally kept the streaming because you can use it as much as you like and you can watch more than one movie unlike only having one dvd. Also I figured when I cancelled they lost $9.99 that they thought they'd get extra off of me. ($7.99 unlimited DVD + $2.00 Blueray)
I love the streaming service. I watch shows from the 60's till the 90's. Back then they had great quality shows unlike today. I do wish that more stuff was available on streaming though but when I had the disc service all I got were current movies. Never bothered with them sending me one disc at a time though snail mail to try to watch the series. If it was not avilable for streaming I either waited like I did with the Star Trek series, I either bought the series on disc or did not even bother with it.
The problem with your argument, Don, is that Netflix doesn't even have a business if either content owners, OR ISPs, don't like what Netflix is doing. I lost all respect for Reed Hastings when he falsely claimed that ISP caps were of no concern. He later recanted, but it was clearly a bald-face lie meant to placate his investors. Given the mondo missteps Netflix has made recently, I'm surprised you're going long. Hastings is no Jeff Bezos.
No, actually I haven't had dialup internet for about a decade now and I've used high speed broadband video HD (what there is of interest that NF offers) streaming, before they jacked their rates.
With the economy the way it is, I opted for the disc-via-mail option and dropped streaming because NF just flat doesn't have the content ready yet. They're now having issues with content providers (Starz walked away from the table, taking all their content with them by early 2012), other providers want increased rates for their content. Guess who'll be paying those increased rates if they stay with Netflix for streaming, assuming NF can even come to terms?
Give me more content via snail-mail anyday for $9/month vs. limited content and lower-rez streams for a buck-a-month less. Hmm...quantity and quality vs. convenience? Guess which one wins for me?
Right now, Netflix is walking an extremely fine line with a very sharp edge.
Supposedly, the latest FW updates for 722 & 722k contain 'Blockbuster@Home' branding....
And this is the big problem with the streaming business model
It all depends on the deals you can broker for content .
the same problem with the premium channels you have to have all of them to see all the movies you want .
In my opinion people no longed have the income to do this.
to me the DVD rental is still the way to go you pay for what you want to see.
I hate to see Netflix go away I love It but a way they are to go if the dvd rental is out.
The problem with Netflix is that their main competition is DISH Network and their 13 million subscribers. Its DISH Network who holds the major contracts with Starz, HBO and other video service providers, and im sure they get cheaper rates to provide streaming content.
Hopefully this is the beginning to the end of Netflix.
Hopefully this is the beginning to the end of Netflix.
WalMart has their VUDU service which they haven't really made a big pitch with yet.
Vudu quality is EXCELLENT but their prices are high as its on a per movie basis and they charge you for the resolution for the movie you watch.
Vudu quality is EXCELLENT but their prices are high as its on a per movie basis and they charge you for the resolution for the movie you watch.
That argument doesn't hold water because it would apply to any provider, especially Dish Network. Many of the sat guys turn on these CEO's on dime and when February rolls around most of you will be screaming all over again that Charlie is ripping you off with another rate increase.
I've said all along that this is a plan for the future that Netflix is following and I happen to agree with it. It's nothing more than repeating history. In this case it's Netflix that is and has charted new ground. As a company, the goal to isolate and de-emphasize DVD mail disks just makes sense to me, especially considering the trouble the post office is in. If you don't watch many movies, say 1 or 2 a month then the DVD rental is probably your best bet. I watch more and I'm looking for the lowest cost and no matter how hard you twist the numbers Netflix is still a bargain unless you must watch a particular movie that isn't offered by them. But, I can make that case for Blockbuster too. I can't get Dexter in Blu Ray at Blockbuster. I can't get Thomas the Train series loved by my grandson at Blockbuster. I get it from Netflix streaming. I usually watch 4 movies a week on Netflix streaming that I haven't seen before not offered by Blockbuster. I also just completed the entire series of 96 episodes of Criss Angel. It all depends on what you want to watch. With 45,000 titles, more than any other single provider, to say they have nothing is narrow minded or ignorant.
Strategy speculation: let's assume Dish signed a deal with starz to get the streaming rights to Sony and Disney titles. Do you think Dish is paying $300,000 a year for it knowing Netflix has it now for $30M? If so then Netflix will need to ante up. If not then it was a smart negotiation to hold out, and allow Dish to negotiate a better deal and now Netflix knows what the market will bear. I see this as nothing more than negotiation strategy. As was said by others, Netflix has plenty of time to finalize a deal once the market price for starz is established. They just didn't want to establish it at $300M. Smart!
I'll part ways with Netflix when and if Dish / Blockbuster has a better deal and at least matches the technical quality. Right now money and quality and quantity talks and emotion, anger, and spite walks.
As for long term trend investment, I'm banking on Netflix becoming a world wide service and the profits those subscriber numbers will bring. The current Netflix stock price is way oversold and the foreign business isn't even accounted for in the P/E ratio yet the loss of 1 Million subscribers and the loss of starz is in the current numbers. I'm thinking I want to double down on my position soon.
I just have to decide to dump some Google stock to do that. The only thing I didn't like about the Reed Hastings comments is he sold some of his stock when it was up, which was noted in the blogger reports, But, those reports, none of them, made mention that he bought it all back share for share with soon to expire options. I had to pull the SEC form 4's on insider trading to see that. Moral of that story is don't put your entire faith in the accuracy of a blogger report.
One cannot assume that the Dish/Blockbuster deal will be flat rate pricing. It is quite possible that BB made a deal with Starz to put its content in a premium tier. They could do the same with the other Pay TV providers. It would open up a lot of interesting things if you could for example pay $X a month and essentially get HBO (like HBO GO) or Starz via streaming.
There are so many ways this could go. They could charge per movie (like $1 to match red box).
They could essentially take old shows and have unlimited streaming for $X with $1 new movies (perhaps a few included in the base charge). You could add Starz or HBO if you liked. Throw in Hulu and you have the makings of an IP based cable system without the sports.
There are so many ways this could go. They could charge per movie (like $1 to match red box).
They could essentially take old shows and have unlimited streaming for $X with $1 new movies (perhaps a few included in the base charge). You could add Starz or HBO if you liked. Throw in Hulu and you have the makings of an IP based cable system without the sports.
