Netflix Loses 600k Customers In Q3, Things Likely To Get Worse

[Minions]

It's really not netflix fault, they were pretty much screwed any way they went. Pretty much everyone wants 5-10x what they originally licensed their content for. (Due to Netflix revenue) Now new contracts are not signed and lots of customers are leaving, making Netflix less profitable. However those companies still want 5-10x the original contracts for their content.

It is pretty bogus when you think about it. Pretty much any streaming company can be shut down as soon as their next round of contracts comes out, be it Hulu or Netflix. Seems like the same sliding trend that the 3DS had, once a few games canceled a lot of developers lost interest.

TLDR: Netflix Damned if you do, Damned if you don't.

[Plow]

Guys, we can offer a tremendously better product at the same price, and lose very little profit on our current customers, while potentially bringing in literally millions more!

WTF did you just say? LOSE SOME OF OUR PROFIT?!?! YOU SHALL BE DAMNED! SMITHERS, DOUBLE OUR PRICES!

Wait... wait... don't leave me... I didn't mean to... we just want to be a better company! Please, don't leave, pity us!

Spoiler: show

Come on guys it's only 7 dollars and they promise they'll be better next time!

[Shuvo]

They can't really be blamed, the content providers massively upped their price as they figured they could make more money setting up their own service instead of licencing it out to companies like Neflix.

Prices are crazy atm. I am working for a company that recently wanted to purchase a licence to distribute eps of Buffy /just/ to the Australia/New Zealand market - they wanted a million dollars even though it's just an old crappy 90s series for a small market like AU/NZ ~_~ So you can imagine how crazy the prices would be for Netflix as they deal with newly released films and popular shows for a massive market like NA!

[kuronosan]

Not judging, just curious. Why is everyone in this thread that has cancelled made that decision? My bill increase was no more ridiculous than cable bill jumping up a few dollars, or phone bill, or... shit rent? Just wondering though, is it the grim outlook? So get out now? I just don't see a reason yet to drop em, and want to know why people are jumping ship.

It's important to realize that for me it wasn't about the money. Even though I was a streamer only I don't take kindly to being treated like a) an idiot and b) a sucker. The fact that the CEO had the audacity to insult his client base doesn't sit well with me at all. More importantly, the content I want to watch is DVD only (George Romero, hi2u) and when I finally do get access to the movies, they get pulled down or the movie doesn't load. Honestly I would rather Redbox my movies for a dollar than $8/month for sub-par selection of movies and delayed new releases that may or may not be available when I get around to watching them. That doesn't even take into account that they lost some of their major players in the streaming part.

In short, there are better options out there and it's about time companies started realizing they can't just treat their customers like they're idiots. It's better to send a message than continue to give my money to a company that has shown it doesn't care whether they get it from me or not. Even if it is just $8.

[Kaisha]

And here I am wishing Canada actually had options outside of Netflix.....

I get my money's worth out of the service, but our selection is even worse than yours and you're all up in arms about it. I'm just hoping Netflix up here is operated independently of the USA's so I'm not fucked over in my viewing selection also.

[Ace-o-fire]

I cancelled a couple days ago, serves this company right for not even giving us 3 options to work with. I would have been fine with a 10-12 dollar a month for both, but 16 bucks hell nah. Right now I'm on the fence about trying the Blockbuster service or just putting extra money towards better cable.

either-way this was a dumb business model for this company. I wonder if they had an outside consulting firms working on this disaster or if it just internal.

[Day]

They can't really be blamed, the content providers massively upped their price as they figured they could make more money setting up their own service instead of licencing it out to companies like Neflix.

Prices are crazy atm. I am working for a company that recently wanted to purchase a licence to distribute eps of Buffy /just/ to the Australia/New Zealand market - they wanted a million dollars even though it's just an old crappy 90s series for a small market like AU/NZ ~_~ So you can imagine how crazy the prices would be for Netflix as they deal with newly released films and popular shows for a massive market like NA!

SKREEEEECCCHHH.... woah son. woah. Buffy is not a "old crappy 90's" series. Shut your damn mouth.

[Callisto]

It's really not netflix fault, they were pretty much screwed any way they went. Pretty much everyone wants 5-10x what they originally licensed their content for. (Due to Netflix revenue) Now new contracts are not signed and lots of customers are leaving, making Netflix less profitable. However those companies still want 5-10x the original contracts for their content.

I think this is the part that's getting overlooked lol, their profit margin on streaming was fucking massive, it's not like the upped price demands of the vendors would have put them into the red, it would have just trimmed their margin down, and then they would have an actual plausible reason for a price hike, they could easily point to the new inflated contracts and crap out a presser of "due to the increased price of content we are forced to raise the prices of our services", and users would likely be a bit more understanding than their current "we're raising prices while losing content, suck it lol". They took a gamble by turning it down, and so far it looks like they're losing on it.

SKREEEEECCCHHH.... woah son. woah. Buffy is not a "old crappy 90's" series. Shut your damn mouth.

^This.

You're treading dangerous ground there, pal.

[Velgadess]

spoilered for long article

http://www.hollywoodreporter.com/new...hopes-us-28218

Spoiler: show

Netflix is now in Canada, offering local subscribers an online movie and TV streaming service for $7.99 a month. The move marks the first international foray for the California-based online streaming/DVD-by-mail giant. Etan Vlessing caught up with Netflix co-founder and CEO Reed Hastings in Toronto as he reaches beyond his 15 million American subscribers to start rolling out his online subscription service around the world.


Reed Hastings: For now we're focused on Canada. If we succeed in Canada, we will certainly look at other markets. But each market is unique, and what attracted us to Canada is great broadband, and a great love of movies and TV shows.

THR: American services when they enter the Canadian market typically charge the locals more than they charge stateside. Why the discount for Canadians?

Hastings: We want to provide an incredible value for Canadians, and it's the lowest price we have anywhere in the world for unlimited screenings. And anyone can try it for free for a month. It's pretty addictive.

THR: Are you concerned that American Netflix subscribers will look north and ask for the same discount Canadians get at $7.99?

Hastings: How much has it been your experience that Americans follow what happens in the world? It's something we'll monitor, but Americans are somewhat self-absorbed.

THR: How will you will measure success for Netflix Canada?

Hastings: I'm certain we'll succeed, so it's kind of a matter of degree. We're not quantifying that in terms of subscriber numbers or profitability. What we're focused on is getting out there. We've got to get out on all of the devices, get the word out, and we need to be such a good service that people not only stay with us but rave to their friends about it.

THR: After Canada, where else will Netflix expand internationally?

Hastings: We're really open-minded, whether that's western Europe, Latin America, Asia or Russia. It's unlikely to be Africa, but other than that, all continents are open.

THR: The knock on Netflix is you offer mostly library content. Are you looking for more Canadian subscription revenue before you pay out for newer content? [Related: The network that won't stream its shows on Netflix.]

Hastings: Yes and no. In the States, it's mostly older content also on streaming, and it's been wildly successful. And where we add unique value, a new option, is making the great TV shows and the great movies from around the world available. When we just do the new hot show that's already on TV, and anybody can get it there, there's less added value for us. And we're not trying to be the only option that Canadians use. We're trying to be one more supplemental option, so Canadians will watch some over-the-air TV, have cable or IPTV, and rent or buy DVDs.

THR: Your new Canadian competitors like broadcasters and cable operators offer sports. Any chance Netflix will offer that?

Hastings: Very unlikely. Our brand at Netflix is really focused on movies and TV shows. And sport rights are a very different group of rights. In the States, there's ESPN3, and each country has different options, and other than premiere league football, there tends to be very little global content. And movie and TV rights are pretty broad content.

THR: Is the Canadian market any different than the U.S. in terms of consumer patterns?

Hastings: No, it's pretty universal, the attraction to great value and the low price, and the unlimited. And I can't emphasize the unlimited enough. To be able to do the on-demand for a flat fee is just wonderful for people. And I think that will be true in nations around the world, including the States and Canada.

THR: So the U.S. and Canadian Netflix services are identical?

Hastings: It's identical in terms of interface and how you sign up. The content is unique to Canada as we have to license it separately. And in the States, there's also the DVD-by-mail part, which will only be in the States.

THR: Why not expand the physical DVD delivery service into Canada?

Hastings: There's a finite market for DVD-by-mail, and the growth over the next 10 years will be in streaming. If we were starting out in the States now, we would do the same thing and focus on streaming.

http://old.news.yahoo.com/s/ytech_ga...ch_gadg_tc3717

Spoiler: show

To say that Netflix is having a pretty bad week is, well, putting it mildly.

First, it marred what should have been a triumphant launch of its streaming-video service for Canada by hiring actors to pose as members of an "enthusiastic" crowd at a press conference. Then its normally level-headed CEO got a little too chummy with a reporter in Toronto, telling him that Americans are too "self-absorbed" to notice that Canadians will be paying less for streaming than U.S. users are.

Oh, boy.

Normally, I leave these kinds of PR gaffes as fodder for our resident media blogger at Yahoo! News — but since there’s an actual tech angle here, I’ll bite.

First things first, though. Having belatedly realized that he’d managed to insult, you know, his entire base of U.S. customers with his "awkward joke," Netflix CEO Reed Hastings posted a bowing, scraping apology on the official Netflix blog Thursday night, explaining that he was wrong to label Americans as "somewhat self-absorbed" people who generally don’t "follow what happens in the world."

"I do not believe that one of the most philanthropically-minded nations in the world (America) is self-absorbed or full of self-absorbed people," Hastings wrote. "My apologies to anyone offended by my self-absorbed comment." Well, that’s a start — although judging from the scores of angry comments to his post, a red-faced Hastings still has a lot of apologizing to do.Now, for some real tech news. As I wrote earlier this week, Netflix’s new $7.99-a-month, streaming-only service for Canada highlights the fact that for now, there is no streaming-only option for Netflix users here in the States. (Hastings had previously said that Netflix won’t be mailing DVDs in Canada because of the "tricky" proposition of shipping discs though non-U.S. postal systems.)

Of course, the fact that U.S. users are paying only a dollar more to get DVDs in the mail (one at home at a time, in the case of Netflix’s $8.99 subscription plan) in addition to video streaming kind of undercuts the whole "Canadians are paying less than Americans" argument that started this whole mess.

Still, in his apology Thursday, Hastings added that Netflix is "looking at adding a streaming-only option for the USA over the coming months," a possibility that Netflix execs first hinted at way back in February 2009.

If you ask me, a streaming-only subscription plan for the U.S. would — or rather, could — represent one of the best values in home video today, especially considering Netflix’s solid catalog of 20,000-plus "Watch Instantly" TV shows and movies. (Indeed, Netflix just inked a new streaming deal with NBC Universal that includes every new episode of "Saturday Night Live," as well as SyFy’s "Battlestar Galactica.")

But I’d be lying if I didn’t say I was disappointed by the pricing for Netflix’s streaming-only service for Canada — again, it’s $7.99 a month, just a buck cheaper than the $8.99/month plan in the U.S. that includes one mailed DVD at home at a time.

Now ... if the streaming-only plan was more like $5 a month, then we’d be talking. (Just to be clear, the key word here is "bargain." Movie fanatics, like me, who are obsessed with picture quality and title selection will still probably prefer to pay more for physical DVDs and Blu-rays.)

So, anyone like the idea of a streaming-only Netflix plan for the U.S. — and if so, how much would you be willing to pay? Oh, and are you satisfied with Hasting’s apology? (My first thought, being the geek I am, was: "Apology accepted, Captain Needa." Name the movie and the character, and I’ll give you a gold star.)

TL ; DR

THR: American services when they enter the Canadian market typically charge the locals more than they charge stateside. Why the discount for Canadians?

Hastings: We want to provide an incredible value for Canadians, and it's the lowest price we have anywhere in the world for unlimited screenings. And anyone can try it for free for a month. It's pretty addictive.

THR: Are you concerned that American Netflix subscribers will look north and ask for the same discount Canadians get at $7.99?

Hastings: How much has it been your experience that Americans follow what happens in the world? It's something we'll monitor, but Americans are somewhat self-absorbed.

He apologizes afterwards:
Having belatedly realized that he’d managed to insult, you know, his entire base of U.S. customers with his "awkward joke," Netflix CEO Reed Hastings posted a bowing, scraping apology on the official Netflix blog Thursday night, explaining that he was wrong to label Americans as "somewhat self-absorbed" people who generally don’t "follow what happens in the world."

"I do not believe that one of the most philanthropically-minded nations in the world (America) is self-absorbed or full of self-absorbed people," Hastings wrote. "My apologies to anyone offended by my self-absorbed comment." Well, that’s a start — although judging from the scores of angry comments to his post, a red-faced Hastings still has a lot of apologizing to do.

[Katlan]

it's like he is trying to ruin his own company

[kuronosan]

This guy is a fucking idiot.

[Enygma55]

Someone needs to hire a new PR person to speak for his ass lol

[Kaisha]

But each market is unique, and what attracted us to Canada is great broadband, and a great love of movies and TV shows.

AHAHAHAHAHAAH....HAH...

Spoiler: show

Our ISPs are such jews Netflix.ca actually had to offer lower-bandwidth options for their entire library.

[Ksandra]

Just to clarify, both those articles are a year old. (I was confused as fuck at some of the comments in the second article so discovered that).


Of course, that doesn't mean this won't hurt netflix since the articles have resurfaced, but ya.

[Salodin]

This guy has been a retard for a long time apparently. I wouldn't be surprised if after their q4 earnings (or loses) come out there will be some restructuring.

[Dantrag]

canceled our netflix.

[fren.]

The "new release" thing continuously pumps out shit after shit. You can't find anything worthwhile other than the occasional Korean flick and the horror/action section is just saturated with made-for-tv garbage.

[Dmitry]

I get a lot of use out of my subscription, but that's mostly because I work 3rd shift and spend a lot of time watching movies and shows. Plus like 2 other people use my account so it's definitely getting used.

[volcanicweather]

Nobody has posted about the new blockbuster offering?

Blockbuster Movie Pass will cost $10 a month on top of the monthly Dish satellite TV bill. As part of an introductory offer, Dish is including Blockbuster Movie Pass for a full year at no extra charge with its America’s Top 200 package for $39.99. Movie Pass is available free for three months with the America’s Top 120 programming package for $29.99.

The $10 monthly fee is good for one rental disc out at a time. Additional discs out at a time begin at $15 a month.

Movie Pass includes access to 100,000 DVDs and Blu-ray Disc titles by-mail, 3,000 video games by-mail, 3,000 titles available to stream to the TV, 4,000 movies to the PC and Mac computers and 20 premium entertainment channels.

By comparison, Amazon Prime offers 9,000 streaming titles and Netflix Instant Watch boasts a catalog of 20,000 titles.

Consumers access Blockbuster Movie Pass through their Dish remote control, including their disc rental queues, or through a link at Dish.com.

There is no additional charge for Blu-ray titles. Movie discs can be exchanged in Blockbuster stores.

“When the economy changes, when technology changes, when the customer changes, you better change,” Clayton said. “More Americans are demanding an easier way to view their videos.”

A non-Dish plan is in the works and will be announced in the future.

If you're a Dish Network customer it's $10/month for 1 disc (PS3/360 game, Bluray, DVD) and you get access to their streaming library for TV/PC/MAC and 20 premium channels. Non-dish package coming soon. You get a free year if you switch to Dish Network and get their $39.99 package or you get 3 months free with their $29.99 package.

Once this is available to non-dish customers, especially if it's still $10, Netflix is going down in flames.

[Acturus]

http://money.cnn.com/2011/09/26/tech...ix_dreamworks/

#####

NEW YORK (CNNMoney) -- Two of the key players in the battle for online streaming market, Netflix and Amazon, announced Monday that they've acquired new weapons for their content arsenals.

Netflix has sealed a streaming deal with DreamWorks Animation -- and unlike many contracts, this one is an exclusive.

The multi-year agreement gives Netflix (NFLX) the sole streaming rights to some of DreamWorks' movies and TV specials. But it won't kick in until 2013 -- an eternity in Internet time.

DreamWorks new titles will be available for streaming starting with movies released in 2013. Older movies -- including Antz, Chicken Run, Madagascar 2 and Kung Fu Panda -- will also be made available "over time."

It's a spot of good news for Netflix, which has had a rough year and has been working to ramp up its streaming catalog. The company lost its important Starz/Sony contract earlier this month. And customers -- who are already angry about a Netflix price hike -- have been complaining about a dearth of streaming options.

Some are doing more than just complaining. Two weeks ago, Netflix cut its subscriber forecast for the third quarter by 1 million. In addition, Netflix has been facing ramped-up competition from Hulu and Coinstar (CSTR) as well as big tech players including Amazon and Google (GOOG, Fortune 500).

As a result, Netflix shares are down a scary 51% over the past three months. The DreamWorks announcement gave the stock a boost early Monday, but by midday shares were trading close to flat.

#####

I'll keep my account for DreamWorks. My three year old will thank me, sort of. He won't really understand, but he'll appreciate the movies.