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Netflix Has a Customer Crisis

Posted on Sep 15, 2011
Ross Catrow (CC-BY-SA)

With about a quarter of all Internet traffic in North America passing through its servers and roughly 25 million subscribers, Netflix got everybody’s attention in July when it announced that it was raising its prices by as much as 60 percent.

Now the company is conceding that it has lost more customers than expected.

AP and the BBC are quoting different numbers, ranging from 600,000 to 1 million, so we’ll just settle on a lot—PZS

AP via Google:

The customer backlash against the higher rates, kicking in this month, has been much harsher than Netflix Inc. anticipated. That prompted management to predict Thursday that the company—the largest U.S. video subscription service—will end September with 600,000 fewer U.S. customers than it had in June.

It will mark just the second time in 12 years that Netflix has lost subscribers from one quarter to the next. The last downturn occurred during 2007 when Netflix lost a mere 55,000 from March through June.

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By les4tom, September 20, 2011 at 6:28 am Link to this comment
(Unregistered commenter)

Cancelled Netflix quite awhile before rate hike. Did’nt like that over 50% of movies I received were broken, cracked, and damaged. That was unacceptable. Despite my emailing them (the eternal optimist) to change their packaging, they did not. I said good day - less politely.

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By Hulk2008, September 18, 2011 at 4:15 pm Link to this comment

At about $18 a month, it’s surely a big savings over cable TV, not to mention the freedom to choose content explicitly.  Or maybe the increases were a way to cut back on disk mailing except for a subset of customers. 
Netflix is a lot cheaper than other vendors too e.g. Blockbuster.
Face it - it’s much cheaper than smoking and it won’t stain your teeth.

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By aacme88, September 18, 2011 at 6:18 am Link to this comment

This should be worth a hefty bonus for the CEO. I’m sure it’s in his contract.

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By Anthro, September 17, 2011 at 4:15 pm Link to this comment


I concur. I have always used the library and its extensive resources wherever I
have lived—from small town to big city. Public libraries are just about the last
bastion of democracy.

@ MeHere

I saw Eyes on the Prize years ago on PBS—a couple of times, at least, but
thanks for the reminder; it’s time for the grandkids to see it. I get a lot of
foreign films from Netflix, and many of them are streaming, but they are short
on a lot of the BBC stuff (not their fault—difficult negotiations involved they

I will end up re-subscribing, but wanted to protest what I still see as an
excessive price increase. I don’t turn the CD’s around fast enough to justify it
on a fixed income, but I do have to praise their customer service. You get a live
and knowledgable person in Portland, Oregon who listens and helps in a timely

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Robespierre115's avatar

By Robespierre115, September 17, 2011 at 12:05 pm Link to this comment

If the prices are too much at Netflix people should have the common sense to support their local PUBLIC LIBRARY. California, despite all its faults, has an excellent system with all the latest DVD releases available FOR FREE. And not just popular movies, they have all the best rare documentaries, TV programs, independent films etc.

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By MeHere, September 17, 2011 at 7:26 am Link to this comment

Obviously, different people expect different things from Netflix.  My interest is
in international film, including work done in the US and other English-speaking
countries -from classic to modern in various genres, feature and documentary,
and some TV work.  I love film as an artistic medium so most Hollywood and TV
production is not on my rental list. Netflix is the only source that I know of
which can provide what I like. They don’t have everything ever made (some
things are not on DVD) but their collection is vast and they keep adding new

I’ve been very pleased with their service for years. At the moment, I only have
the one-at-a-time subscription (no streaming) and this has just gone down in
price.  Not everything that they have on DVD is also available on streaming. I’m
looking forward to increasing to two-at-a-time or adding streaming in the
near future.

If you’re interested in political/social issues and you haven’t seen the superb
documentary called “Eyes on the Prize: America’s Civil Rights Year 1954-1965,”
Netflix has it in 3 discs. I recently got it from Netflix.

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By Leefeller, September 17, 2011 at 5:59 am Link to this comment

“Greed often backfires.”????? Maybe in the movies!

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By Anthro, September 16, 2011 at 8:49 pm Link to this comment

While I knew an increase was coming, I thought it was excessive and cancelled. I
will look elsewhere or just…READ MORE BOOKS.

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Gabriel's avatar

By Gabriel, September 16, 2011 at 4:22 pm Link to this comment

@ Patrick

Most of the PPL I know open their browser with minimum of 50 news websites world wide and up to about 500.
Firefox with addons: adblockplus, betterprivacy, cookie blocker, downloadhelper, noscript, flagfox, remove it permanently, session manager, tor network or some vpn for privacy

Netflix is bullshit ... for those who are newbies to net.
If you savvy ALL info is Free .. ALL of It! .. it is the premise Internet is built on. smile

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PatrickHenry's avatar

By PatrickHenry, September 16, 2011 at 3:00 pm Link to this comment

I have never tried netflix, by the way some of the other posters here recommend it I think I will try it.

I often watch Link TV and Thom Hartmann, Al Jazeera is an eye opener as compared to anything the MSM has to offer.

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By MouldingTheFuture, September 16, 2011 at 11:32 am Link to this comment
(Unregistered commenter)

I have been an avid Netflix subscriber for years, and hopefully will be for a long time to come.  Netflix, to me, represents a freedom of speech that is quickly being abolished in this country.  Many political documentaries offered as streaming media are important counteractions to the severely biased media we have feeding us otherwise.  I expect that Netflix has offered shows such as the ones Starz had contracted to them in order to allow more shallow viewers the opportunity to see programs that could steer them toward understanding what mainstream news broadcasts have been doing to public opinion.
Corporate interests have limited what has been made available to us through the programming we have had to choose from.  Netflix has proven invaluable in allowing rebuttals for many of the misrepresentations of the media to be seen rather than silenced.
I’m fine with the price increase as it has been so extremely affordable all along.  Other than that, all I have to say is SEE YA LATER, STARZ!

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By Brian, September 16, 2011 at 8:36 am Link to this comment
(Unregistered commenter)

Last time I checked, Netflix offered 7 of their top 100 movie titles for instant streaming!

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By Tobysgirl, September 16, 2011 at 5:43 am Link to this comment

I am a Netflix fan, and I am now paying less per month than I was due to Netflix’s separation of streaming and mailed DVDs. I never used the streaming function, so now I don’t have to pay for it. When and if I do use it, I will reduce my number of DVDs out at one time and not pay more.

Is this another case of people not paying attention to the details of Netflix’s alterations and just cancelling their subscriptions in a huff? Like all the petulant Obama supporters who voted Republican last year?

By the way, Netflix is the only place I know to rent superb documentaries ranging from the film about Cynthia McKinney to Sir, No, Sir (with a ton of extras that wouldn’t be available in a theatre).

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Gabriel's avatar

By Gabriel, September 16, 2011 at 5:13 am Link to this comment

And Lawful sharing of files between individuals went up by about 5 million in the same time ... hmmm.

There are more and more PPL getting together and buying direct fiber then ever before ... Outside of business jurisdiction and under Common Law.
Get the hint? smile

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A Bird in the Hand's avatar

By A Bird in the Hand, September 16, 2011 at 5:01 am Link to this comment

The Soldier Who Killed Herself After Refusing to Take Part in Torture

antiwar dot com

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By SoTexGuy, September 16, 2011 at 2:53 am Link to this comment

It’s just business, no need to get excited. In fact it could be great business if they can raise their rates 60% and lose only 4% of their customers.. Planners may even believe the customers who leave will be the ones that were spending the least.

NetFlix isn’t a right or a basic service. Let them charge whatever the heck they want. If it doesn’t work out, so what. My thought is they know very well what they are doing.

Want to get uppity about the price-gouging and poor-quality of a product? Pick one we rely on.. the water that comes out of the tap! For starters..


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By Marian Griffith, September 16, 2011 at 1:12 am Link to this comment
(Unregistered commenter)

People are willing to pay a lot to have their brains shut off in a comfortable way, be it through alcohol, marihuana, drugs, or indeed television or movies.

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By Matt, September 16, 2011 at 12:21 am Link to this comment
(Unregistered commenter)

Capitalism is a double edged sword, the sooner the
population learns how to swing it in their favor the
better, this is a step in the right direction.

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Robespierre115's avatar

By Robespierre115, September 15, 2011 at 5:53 pm Link to this comment

Same reason why the traditional rental stores either collapsed (Hollywood Video) or are having serious problems (Blockbuster Video). Ticket prices at the local theater are also going up and up, of course they don’t get into too much trouble because the population marches in like idiot sheep to pay for junk food like “Transformers.”

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PatrickHenry's avatar

By PatrickHenry, September 15, 2011 at 5:19 pm Link to this comment

Greed often backfires.

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