More like Notflix
Students abandon service after price increase
Ali Clark | Collegio Reporter
Netflix has gone through an array of changes the past few months, changes that resulted in the company losing almost 1 million customers.
One of those customers is Nick Popejoy, sophomore in elementary education. Popejoy had Netflix, both online streaming and mailed-in DVDs, for a year and a-half before he quit in July.
“The increase in price was kind of a cherry on top of it,” Popejoy said. “Downloads were real slow for the instant streaming and there weren’t very many movies available that way that were worth a dime.”
Since Netflix was launched 12 years ago, it has morphed into not only a DVD rental place that mails customers DVDs, but also an online instant streaming site. Customers could get unlimited streaming plus the usual DVDs by mail for a total fee of $9.99 per month. In July of this year, Netflix announced a price jump from $9.99 for both services to $7.99 for each individual service. This might not seem like much for a movie and television show service, but Netflix customers around the country were upset when the 60 percent price increase was announced.
Last week the CEO of Netflix sent out an apology to customers for the price jumps and also the more recent changes. He announced they would be separating their two services. They would now be labeling the mail-in-DVD service “Qwikster” and keeping the Netflix name for online streaming. The services will have two separate websites and will still be from the same original company. If customers want to continue to have their DVDs mailed to them, they will have to register their credit card information on the new Qwikster website as well as the Netflix website if they want to keep streaming. This news went viral over the Internet and customers were outraged.
Popejoy says most of his friends were done with the service once this was announced.
“Most of my friends all dropped it,” Popejoy said. “They didn’t even want to go to Qwikster, they weren’t even going to try it.”
Chuck Fischer, professor in economi
cs, finance and banking, says that sometimes companies will do just fine when they raise prices on their products if they market it well. Fischer says that when marketing a new product, a company usually says it is an even better product than the last, and this will convince customers that the higher charge is reasonable.
“In this case, it’s the same old product in a less convenient form at a much higher price,” Fischer said.
Danielle Davis, senior in international business and Spanish, has Netflix for her Hispanic Film class. She has to watch certain films that are on both the online streaming and DVDs that are mailed in. Davis says she is not looking forward to the coming changes. She knows she will have to balance her information between two different sites and also have to search for certain movies on two different sites. Davis says she isn’t sure she will keep the Netflix services after her class is over.
“I might just keep the streaming and not do the DVD anymore,” Davis said.
Popejoy says he has turned to some alternatives to Netflix after quitting their service.
“I get my movies now from Amazon instant download and then just through Hastings here in town,” Popejoy said.
Fischer says the number of alternatives plays a role in how people react to a price shift.
“If you don’t have many alternatives, people are not going to be very sensitive to a price increase,” Fischer said. “The extreme case would be insulin for a diabetic. The price of insulin goes up, there are no real good alternatives, so you just have to pay the price.”
For some students, the newest change will not affect them. Amanda Fifield, senior in elementary education, just has the online streaming services. Fifield says she didn’t bring a DVD player this year, so online streaming is just an alternative way for her to watch movies and TV shows. The alternatives did not stack up to Netflix, according to Fifield.
“I wouldn’t do Hulu Plus, only for the fact that when I had it for a little while over the summer, just as the trial run, they didn’t really have any new movies out,” Fifield said.