If there is one thing in my life that I would not trade, it is my Netflix subscription. Since my first rental on January 3, 2006, I have rented and viewed 532 movies (I actually just counted this tonight). If you do the math, that is 49 months that I have held my account. A simple conversion equates this to nearly 11 movie rentals a month. To some people, it may seem like I have nothing better to spend my spare time on. I'd say this were true if I didn't have such a love of movies. Thank god the girl I am marrying in September of this year shares my passion. The best part about Netflix is that I pay $15.79 per month for an unlimited amount of 2 movies at a time (This is only the middle-of-the-road plan). If I had rented through Blockbuster at $4 per movie, I would be paying nearly $44 per month. Savings with Netflix since January of 2006 = $1,422.
This is actually the first time I've done this calculation and am surprised by the savings I've received for an industry I love. I realize that everyone is not as fanatical about movies as I am, but only renting 4 movies a month would have been a breakeven point. I had to laugh when I read in the case that Blockbuster never thought that online video rentals would be a sustainable business model. I used to rent from Blockbuster.....then Netflix starting showing up at my door. The only time I returned to Blockbuster was to get a new release that I would have needed to wait for through Netflix. Now, Netflix has a content management system which limits the time you have a wait for the newest, most popular release. Needless to say, my Blockbuster card is currently occupying space in a landfill as compared to my wallet. Blockbuster lost millions and millions of dollars by turning a blind eye to the potential of the online video rental industry in early 2000. It's move to an online subscription in 2004 was simply an attempt to recover what it had already lost. Unfortunately for Blockbuster, Netflix has already established its position and gained a large amount of loyalty from its users. Blockbuster's online service simply minimizes the damage done by Netflix.
I've been with Netflix as it has moved through its progression toward VOD. I currently own a Playstation 3 and have the Netflix CD which allows you to stream instant movies to your TV through the PS3. This system works incredibly. The only complaint I have is that the instant movies on Netflix are never the newest releases, but I can deal with that as I typically receive those in the mail. I think Netflix has chosen the correct path, given the options presented at the end of the case. It was smart to not partner with a competitor....Netflix was already too strong of a brand. The progression of "view instantly" on your computer to now being able to stream to your television has kept me very satisfied with Netflix. The company has recognized where its market is going and has adapted itself to those directions. I will be very interested to see where this industry goes as consumers begin to demand new releases immediately available for viewing on their HD televisions. We are in a period of transition and I am rooting for my friends at Netflix.
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Wow that is a lot of movies!! But seriously, I think you make some excellent points about Blockbuster. Yes, it is laughable that they chose to ignore Netflix for so long. I don't know anyone who uses Blockbuster's online rental service. Everyone I know who tried it ended up unhappy and switched to Netflix. I think Blockbuster is doomed.....
ReplyDeleteI agree w/ Cynthia and you. Blockbuster can really only still make it with those new releases you have to wait to get through Netflix (or another online service - including blockbuster.com).
ReplyDelete@Brian - how's the quality of the streamining through the PS3? I haven't done any streamining from Netflix. I have downloaded some Amazon movies to my TiVo, and that seemed pretty good quality (though took 2 hours to download and we had to wait - grrr).
It’s downright embarrassing for Blockbuster that they ignored the threat posed by Netflix for so long. I wonder how many heads rolled after that?
ReplyDeleteYou certainly saved money by renting through Netflix vs. Blockbuster, but the price per movie with Redbox is even cheaper. I’m curious what your main reason for keeping Netflix is—the benefit of the queue/recommendation system, the convenience of not having to leave your home to rent/return the movies? I used to subscribe to Netflix but did not end up renting enough movies to make it worthwhile, and now I like to get the new releases as soon as they are released via Redbox. My guess is that you rent more of the lesser-known films through Netflix. That is the main problem I have with Redbox—limited variety of films. Maybe when I finish school I will have more time for movies and will start up my Netflix subscription again!
@ Matthew- The streaming through the PS3 is almost the same quality as a DVD. This does not surprise me though, since the PS3 itself has some accelerated hardware for the advanced gaming it serves. Netflix simply gives you a disk to put in the player which allows you to interface with its system. It may take 30 seconds for the movie to start. Once it does, it streams perfectly with no stops or other annoying interruptions. I was actually surprised at how well it works.
ReplyDelete@ Michelle- Yeah, I am intrigued by Redbox every time I walk by it at Wegmans. There is an advantage of getting the movie right when it comes out. However, I am not necessarily concerned with seeing new releases right away. Sometimes, we wait at least a month until we get it on Blu-Ray. We have enough movies in our queue that it really does not matter when we get them. Sure...I'd like to get the newest release right away, but it's also very easy for me to "set it and forget it". If I really wanted to see a movie, I would have went to the theater to see it. If I already waited 6 months for it to come out on Blu-Ray, what's another month? Oh, and yes, I do like not having to leave the house to receive and return movies. Doesn't Redbox also have fees if you do not return the movie the next day?
I use the streaming over Xbox 360 all the time and the quality is pretty good. They've also started offering some HD streaming, although it's been mostly limited to the Starz partnership offerings.
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