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Author Topic: Netflix splitting DVD and Streaming fees (now splitting into two entities!!!)  (Read 5518 times)
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Harkonis
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« Reply #120 on: September 20, 2011, 01:59:53 PM »

the mailmen are distracted by bacon. slywink

All kidding aside, that's a pretty awful mail service issue.  Is there a way for you to just switch to a box at the PO and go grab your mail more often?
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Jumangi
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« Reply #121 on: September 20, 2011, 02:24:16 PM »

The Name of the company is Netflix, not DVDs by Mail. The plan from the beginning of the company has always been streaming. Disc media is going away. Blu-ray is the last format we will see. Netflix is preparing for that. Maybe making missteps along the way(I don't think they should split into two companies either) but they are doing what they feel they need to for the long run.

This doesn't affect me much since I dropped disc service awhile ago as one of those people that would have a DVD sitting around for weeks at a time that I realized I just didn't use it much.
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« Reply #122 on: September 20, 2011, 02:30:02 PM »

Quote from: Jumangi on September 20, 2011, 02:24:16 PM

The Name of the company is Netflix, not DVDs by Mail. The plan from the beginning of the company has always been streaming.

I would disagree with this.  I think it was netflix because you ordered your movies over on the net.  Streaming became an option that they choose to do business in and it's now become their sole focus.
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« Reply #123 on: September 20, 2011, 02:31:38 PM »

too bad they didn't grab Flixster before it was taken......

of course they could go with... DVDelivery.
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ibdoomed
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« Reply #124 on: September 20, 2011, 02:41:00 PM »

Quote from: Harkonis on September 20, 2011, 01:59:53 PM

the mailmen are distracted by bacon. slywink

All kidding aside, that's a pretty awful mail service issue.  Is there a way for you to just switch to a box at the PO and go grab your mail more often?

Yes, if I cared enough but now that we're only doing blockbuster, it's not that big a deal.
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« Reply #125 on: September 20, 2011, 03:29:14 PM »

Quote from: ibdoomed on September 20, 2011, 01:56:19 PM

Regarding the mail. Here we only get mail on odd numbered M-F days. It's not every other day, like it sounds at first. Point of note: September 1st was a Thursday so we got mail; Friday was the 2nd, no mail; Sat and Sun, no mail; Monday was the 5th but a holiday, no mail; Tuesday was the 6th, no mail, Wednesday the 7th we got mail. We went almost a week without mail service. It hurts.

That's really odd.  Is that a city, county, or state thing?
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ibdoomed
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« Reply #126 on: September 20, 2011, 03:45:57 PM »

Quote from: gellar on September 20, 2011, 03:29:14 PM

Quote from: ibdoomed on September 20, 2011, 01:56:19 PM

Regarding the mail. Here we only get mail on odd numbered M-F days. It's not every other day, like it sounds at first. Point of note: September 1st was a Thursday so we got mail; Friday was the 2nd, no mail; Sat and Sun, no mail; Monday was the 5th but a holiday, no mail; Tuesday was the 6th, no mail, Wednesday the 7th we got mail. We went almost a week without mail service. It hurts.

That's really odd.  Is that a city, county, or state thing?


It's a state government thing.
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« Reply #127 on: September 20, 2011, 11:13:36 PM »

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« Reply #128 on: September 21, 2011, 04:48:26 AM »

A series of progressively more insane follow-up emails from Netflix CEO Reed Hastingssmile
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« Reply #129 on: September 21, 2011, 05:14:59 AM »

Quote from: EngineNo9 on September 21, 2011, 04:48:26 AM


Laugh out loud funny!
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corruptrelic
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« Reply #130 on: September 21, 2011, 05:41:36 AM »

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« Reply #131 on: September 21, 2011, 07:33:25 AM »

I *completely* disagree with the notion that physical media is going to somehow disappear.  The nearly 1000 movies I have in my collection prove nicely that some of us will always want to own the item, be able to hold it in our hands, and will never purchase movies in an electronic format. 
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« Reply #132 on: September 21, 2011, 07:58:23 AM »

Quote from: Knightshade Dragon on September 21, 2011, 07:33:25 AM

I *completely* disagree with the notion that physical media is going to somehow disappear.  The nearly 1000 movies I have in my collection prove nicely that some of us will always want to own the item, be able to hold it in our hands, and will never purchase movies in an electronic format

You will when that's the only option possible.   Just because you(and others) don't like doesn't mean it won't happen, although it may take longer than everyone thinks to happen.
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corruptrelic
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« Reply #133 on: September 21, 2011, 08:39:45 AM »

I think it's unfortunate we are heading towards the all-digital future, but we are definitely heading there. Steam is a good example of that. Games are more and more becoming digital and movies are beginning to follow that trend, although at a slower pace.

When we get a "real" movie download option I think is when it really start to take off. I bought around $100 worth of movies on the Playstation store only to have my original PS3 60GB die, thinking I could simply re-download the movies I already paid for, I found out the hard way that if you buy a movie on PSN if you lose the download for any reason, you have to buy it over again.
At least with physical media, it's actually MINE.

I used to be a diehard "physical media" supporter and only just recently started opening up to Steam, mainly because for some games I simply don't have a choice.. I can't go to best buy or walmart and buy my PC game, I HAVE to get it on Steam.
Now having used Steam for a little bit, I'm starting to think this all digital future isn't so bad after all.. can't remember the last time was I bought a music cd. (Used to have hundreds of them collected as well!)

While it won't happen tomorrow, movies will eventually follow the same path as games and music are going..  it's just a matter of time. 
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« Reply #134 on: September 21, 2011, 11:45:21 AM »

Quote from: corruptrelic on September 21, 2011, 08:39:45 AM

I think it's unfortunate we are heading towards the all-digital future, but we are definitely heading there. Steam is a good example of that. Games are more and more becoming digital and movies are beginning to follow that trend, although at a slower pace.

When we get a "real" movie download option I think is when it really start to take off. I bought around $100 worth of movies on the Playstation store only to have my original PS3 60GB die, thinking I could simply re-download the movies I already paid for, I found out the hard way that if you buy a movie on PSN if you lose the download for any reason, you have to buy it over again.
At least with physical media, it's actually MINE.

I used to be a diehard "physical media" supporter and only just recently started opening up to Steam, mainly because for some games I simply don't have a choice.. I can't go to best buy or walmart and buy my PC game, I HAVE to get it on Steam.
Now having used Steam for a little bit, I'm starting to think this all digital future isn't so bad after all.. can't remember the last time was I bought a music cd. (Used to have hundreds of them collected as well!)

While it won't happen tomorrow, movies will eventually follow the same path as games and music are going..  it's just a matter of time. 

Dont forget reading material as well.  Amazon sold far more e-books in the past six months than they sold in physical copies and actual book stores are dropping like flies.  Digital is where its at, baby!

That being said, I do believe that movies on physical media will fight the good fight for a long time.  They keep improving the definition and sound in ways that streaming cant compete with ( yet ) and with providers limiting and throttling bandwidth these days, discs are not going away anytime soon.
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« Reply #135 on: September 21, 2011, 12:45:25 PM »

I am anxious for the future when movies catch up with games from steam/gmg/etc and books from who knows how many digital sources these days. When we can get pure blu+ quality on release day and not pay more than $20 a month, it will be heavenly.

Netflix, make it happen!
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« Reply #136 on: September 21, 2011, 03:56:32 PM »

Blockbuster Announces New Popcorn Bucket Business

Mmmm...plopydops
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« Reply #137 on: September 21, 2011, 03:59:28 PM »

While I do agree with the notion that physical media will *eventually* go away, I think we are likely 10 years away from that point right now.
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« Reply #138 on: September 21, 2011, 04:04:28 PM »

The idea of widespread streaming replacing physical media is facing a negative pressure in the fights over net neutrality, throttling, and data caps that the network providers are fighting back with.  They never built their networks with the expectation that they were going to be used to this capacity by end consumers, and knowing that they can't extract the money they want out of the end consumers, are pressuring the data providers (that they don't own) to pay for all of this data throughput. 
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« Reply #139 on: September 21, 2011, 07:25:23 PM »

Quote from: gellar on September 21, 2011, 03:59:28 PM

While I do agree with the notion that physical media will *eventually* go away, I think we are likely 10 years away from that point right now.

I think it depends on your definition of "go away".  Technically, laser discs still exist.
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« Reply #140 on: September 21, 2011, 08:43:45 PM »

Quote from: Bullwinkle on September 21, 2011, 07:25:23 PM

Quote from: gellar on September 21, 2011, 03:59:28 PM

While I do agree with the notion that physical media will *eventually* go away, I think we are likely 10 years away from that point right now.

I think it depends on your definition of "go away".  Technically, laser discs still exist.

If I can't buy it outside of a specialty shop, it's gone away.
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« Reply #141 on: September 22, 2011, 12:32:02 AM »

I'd like for someone inside Netfllix to leak how many Netflix customers have cancelled their dvd or streaming service, or both, since the last communication.

As a customer who just cancelled one half of the service offerring and is watching closely to see if I should cancel the other half, I'm eagerly awaiting the next communcation from Reed Hastings...mostly for the entertainment value.  I'm worried though that we won't see anymore emails from Reed Hastings...that he's been locked away in a closet somewhere without access to twitter, facebook, or the internet.  I'm actually starting to think that he doesn't really exist, that he's an AI gone awry.  The real Reed Hastings was killed off last year and replaced with an AI doppleganger.     
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« Reply #142 on: September 22, 2011, 01:25:13 AM »

Quote from: Roguetad on September 22, 2011, 12:32:02 AM

I'd like for someone inside Netfllix to leak how many Netflix customers have cancelled their dvd or streaming service, or both, since the last communication.

As a customer who just cancelled one half of the service offerring and is watching closely to see if I should cancel the other half, I'm eagerly awaiting the next communcation from Reed Hastings...mostly for the entertainment value.  I'm worried though that we won't see anymore emails from Reed Hastings...that he's been locked away in a closet somewhere without access to twitter, facebook, or the internet.  I'm actually starting to think that he doesn't really exist, that he's an AI gone awry.  The real Reed Hastings was killed off last year and replaced with an AI doppleganger.     

They may not have posted this directly, but they've given their subscriber distribution by type. Based on their last projections in the 3Q11 guidance there are about 9.8 million streaming only, 12 million with both streaming and DVD and only 2.2 million DVD only. Based on their projections, it looks like more DVD-by-mail only customers are canceling than they initially expected (it was revised downward by an extra 800K subs).

Netflix has spent the last few years getting their streaming service available to as many consumer electronics devices they can. Personally, I can use my Wii, XBox 360, just my TV, my Blu-Ray player and Android phone to watch Netflix. Considering many people want to stream to a TV and not watch streaming on their computer, they're significantly better positioned than other streaming services in this respect. If they can manage to iron out some deals with other content providers (e.g., Disney with their various labels Touchstone, Hollywood studios, Pixar, etc... Oh wait, that's pretty much the Stars catalog... hmmmmmm.) they should be much better positioned than their competition (e.g., Amazon instant streaming). I think most people are expecting an announcement of some kind before the Stars deal expires.

They've mentioned that streaming is their growth market and that DVD-by-mail has leveled off and that their gross margin is (significantly) higher on a streaming customer than a DVD-by-mail customer. The studios have started to protect their physical DVD/BR distribution (sales of which are down) and are starting to introduce delays to Netflix's DVD-by-mail plus they increased competition from Redbox which is much more immediate (granted, without the back catalog). They're not completely abandoning DVD-by-mail (yet!), but its looking like they want to lock up the streaming the best they can while competition isn't as fierce and they have an advantage in hardware. Globally, their new markets will all be streaming only.

I think a lot of Netflix current PR problems are because of a vocal group of their customers that still think of them as a DVD-by-mail company with added streaming instead of the reality of the opposite. The rest is Reed Hastings being a little too honest and forthcoming instead of hiding behind PR speak. I at least respect the man for thinking long term and taking the steps (however unpopular short-term) they see as necessary to grow.

tl;dr: Netflix is really a streaming company not a DVD-by-mail company. DVD-by-mail is expensive, streaming to one of the eleventy-billion Netflix capable devices isn't nearly so. As a result they can get more content for the same money. The actions they're taking are better than them becoming the next Borders.
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« Reply #143 on: September 22, 2011, 02:02:34 AM »

Quote from: Calavera on September 22, 2011, 01:25:13 AM

I think a lot of Netflix current PR problems are because of a vocal group of their customers that still think of them as a DVD-by-mail company with added streaming instead of the reality of the opposite. The rest is Reed Hastings being a little too honest and forthcoming instead of hiding behind PR speak. I at least respect the man for thinking long term and taking the steps (however unpopular short-term) they see as necessary to grow.

Until their streaming service can give me the same movies as the DVD service and have them available at give me the 1080p quality I get from a blu-ray disc, then their streaming won't supplant the DVD service to me.  There are a ton of movies that never even make it to streaming, or make it there only a year or more after being out on disc.  And even their HD streaming, which is only available on a subset of their subset of streaming movies, is nowhere near as good as I get from a downloaded Zune movie (or blu-ray).
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« Reply #144 on: September 22, 2011, 02:28:07 AM »

Quote from: EngineNo9 on September 22, 2011, 02:02:34 AM

Quote from: Calavera on September 22, 2011, 01:25:13 AM

I think a lot of Netflix current PR problems are because of a vocal group of their customers that still think of them as a DVD-by-mail company with added streaming instead of the reality of the opposite. The rest is Reed Hastings being a little too honest and forthcoming instead of hiding behind PR speak. I at least respect the man for thinking long term and taking the steps (however unpopular short-term) they see as necessary to grow.

Until their streaming service can give me the same movies as the DVD service and have them available at give me the 1080p quality I get from a blu-ray disc, then their streaming won't supplant the DVD service to me.  There are a ton of movies that never even make it to streaming, or make it there only a year or more after being out on disc.  And even their HD streaming, which is only available on a subset of their subset of streaming movies, is nowhere near as good as I get from a downloaded Zune movie (or blu-ray).
I agree, that's the biggest stinker in their master plan for absolute global streaming domination.  It's not a 1 for 1 replacement right now for the dvd service.  In fact, it's not even close.  The dvd library is significantly better.  If it were on par with or close to the dvd library, and with the same bluray quality, it would be a no brainer.  They should've waited until they had more deals lined up for their streaming library.  

The logic behind streaming being the future makes sense, but there are so many variables still left unsettled that could f**k up that future, like IP bandwidth limitations, rising broadband fees, service provider streaming data caps, studio licensing issues, technology limitations (I could keep going).  DVDs and Blu-rays work great right now...in fact many people just made the leap to blu-ray.  Why drop your brand and quickstir that market demand right now?  It's too early.      
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« Reply #145 on: September 22, 2011, 03:32:13 AM »

The reason why theres more of a drop in Netflix/Quikster dvd by mail customer base is pretty obvious.  For DVD/Bluray there are a lot of other options out there.  For streaming, not as much.  They raised their prices and charge a premium for bluray.  Blockbuster, for example, doesnt up charge for bluray, allows game rentals in the program, gets the blurays on release instead of 30 days later and the 2 disc plan is cheaper than Netflix. 
 If you were not big on Netflix streaming and decided on a disc only plan, it made sense to find a better alternative and millions of subscribers did just that.  Of course this split will likely make it worse for them.
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« Reply #146 on: September 22, 2011, 02:38:03 PM »

Quote from: Roguetad on September 22, 2011, 02:28:07 AM

Quote from: EngineNo9 on September 22, 2011, 02:02:34 AM

Quote from: Calavera on September 22, 2011, 01:25:13 AM

I think a lot of Netflix current PR problems are because of a vocal group of their customers that still think of them as a DVD-by-mail company with added streaming instead of the reality of the opposite. The rest is Reed Hastings being a little too honest and forthcoming instead of hiding behind PR speak. I at least respect the man for thinking long term and taking the steps (however unpopular short-term) they see as necessary to grow.

Until their streaming service can give me the same movies as the DVD service and have them available at give me the 1080p quality I get from a blu-ray disc, then their streaming won't supplant the DVD service to me.  There are a ton of movies that never even make it to streaming, or make it there only a year or more after being out on disc.  And even their HD streaming, which is only available on a subset of their subset of streaming movies, is nowhere near as good as I get from a downloaded Zune movie (or blu-ray).
I agree, that's the biggest stinker in their master plan for absolute global streaming domination.  It's not a 1 for 1 replacement right now for the dvd service.  In fact, it's not even close.  The dvd library is significantly better.  If it were on par with or close to the dvd library, and with the same bluray quality, it would be a no brainer.  They should've waited until they had more deals lined up for their streaming library.  

The logic behind streaming being the future makes sense, but there are so many variables still left unsettled that could f**k up that future, like IP bandwidth limitations, rising broadband fees, service provider streaming data caps, studio licensing issues, technology limitations (I could keep going).  DVDs and Blu-rays work great right now...in fact many people just made the leap to blu-ray.  Why drop your brand and quickstir that market demand right now?  It's too early.      

Some of those are still risk factors for DVD-by-mail. Rising postal fees, reduction in USPS delivery days, increased DVD acquisition costs (it's the reason for the 28 day delay), disposal of DVDs (rental DVDs are typically the movie only with no extra features), etc. Consider the poor adoption of Blu-Ray shows that DVDs are "good enough", streaming at 720x480 (720x576) is likely "good enough" for many people; there isn't strong incentive to provide a 1080p stream (I would like a DD5.1 sound stream though....). They need to increase their streaming catalog, but they still have a competitive advantage by having the largest library available and access is relativity ubiquitous (See this thread). DVD-by-mail isn't inherently less risky than streaming, the risks are just different but no less significant.

Netflix already operates in Canada where they deal with serious data caps and have managed to pickup 1 million subs at $7.99/month (USD = CAD, basically) and the population there is only 34 million. I can agree with the sentiment that its too early to abandon DVD-by-mail entirely (which is why they haven't), but there is enough risk in it that they need to work on their streaming service and they've stated that DVD-by-mail is hindering that.
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« Reply #147 on: September 22, 2011, 06:47:27 PM »

Quote from: Calavera on September 22, 2011, 02:38:03 PM

I can agree with the sentiment that its too early to abandon DVD-by-mail entirely (which is why they haven't), but there is enough risk in it that they need to work on their streaming service and they've stated that DVD-by-mail is hindering that.

This is the part I don't understand. Why would the disc-by-mail side be hindering streaming? And how does splitting them and breaking the queue fix that? It really seems they want people to stop using the mail service and if that's the case, just stop doing it.

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« Reply #148 on: September 22, 2011, 06:58:31 PM »

If they don't split the queues, how else will they switch to a more lucrative per-person subscription model instead of the per-household one?
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« Reply #149 on: September 22, 2011, 07:44:26 PM »

Quote from: wonderpug on September 22, 2011, 06:58:31 PM

If they don't split the queues, how else will they switch to a more lucrative per-person subscription model instead of the per-household one?

Whoa.... I missed that part.... I'm not down for that.
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« Reply #150 on: September 22, 2011, 07:49:11 PM »

Quote from: ibdoomed on September 22, 2011, 07:44:26 PM

Quote from: wonderpug on September 22, 2011, 06:58:31 PM

If they don't split the queues, how else will they switch to a more lucrative per-person subscription model instead of the per-household one?

Whoa.... I missed that part.... I'm not down for that.

That's happening now, you can't stream to multiple devices at the same time anymore.
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Isgrimnur
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« Reply #151 on: September 22, 2011, 07:51:06 PM »

Which (for now) was a glitch:

Quote
Netflix Vice President of Corporate Communications, Steve Swasey said, in an email, “No Netflix member is limited to less than two concurrent streams. A few Netflix members have heard differently from us, which is an error that we are correcting.”
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« Reply #152 on: September 22, 2011, 08:20:52 PM »

Quote from: ibdoomed on September 22, 2011, 07:44:26 PM

Quote from: wonderpug on September 22, 2011, 06:58:31 PM

If they don't split the queues, how else will they switch to a more lucrative per-person subscription model instead of the per-household one?

Whoa.... I missed that part.... I'm not down for that.

They haven't explicitly said the above, but one of the analyses I read suggested it as a reason and I thought it made perfect sense.
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« Reply #153 on: September 23, 2011, 12:41:52 PM »

Quote from: wonderpug on September 22, 2011, 08:20:52 PM

Quote from: ibdoomed on September 22, 2011, 07:44:26 PM

Quote from: wonderpug on September 22, 2011, 06:58:31 PM

If they don't split the queues, how else will they switch to a more lucrative per-person subscription model instead of the per-household one?

Whoa.... I missed that part.... I'm not down for that.

They haven't explicitly said the above, but one of the analyses I read suggested it as a reason and I thought it made perfect sense.

Well, I think they've proven they don't know what they are doing so we're going to cancel the streaming side as well. When they get day1 releases in at least 720p with 5.1, we'll come back.
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« Reply #154 on: September 23, 2011, 01:11:41 PM »

All units, all units, please respond to multiple shots fired at Neflix headquarters.

Early reports indicate multiple shootings to the foot.

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« Reply #155 on: September 23, 2011, 01:28:15 PM »

Quote from: ibdoomed on September 23, 2011, 12:41:52 PM

Quote from: wonderpug on September 22, 2011, 08:20:52 PM

Quote from: ibdoomed on September 22, 2011, 07:44:26 PM

Quote from: wonderpug on September 22, 2011, 06:58:31 PM

If they don't split the queues, how else will they switch to a more lucrative per-person subscription model instead of the per-household one?

Whoa.... I missed that part.... I'm not down for that.

They haven't explicitly said the above, but one of the analyses I read suggested it as a reason and I thought it made perfect sense.

Well, I think they've proven they don't know what they are doing so we're going to cancel the streaming side as well. When they get day1 releases in at least 720p with 5.1, we'll come back.


I don't think that's going to be in the cards for any all-you-can-eat streaming service, at least while physical distribution and video on demand exist. This would harshly cut into VOD and other digital rental services (e.g., Zune) and I doubt the studios would accept this. I think the studios are positioning services like Netflix (and Amazon Instant) as replacements for Stars, which is why Stars discontinuing their deal with Netflix makes sense. Stars doesn't have the original content that HBO and Showtime have to shop around, in the end they actually end up competing with Netflix as an add on to the standard service. It's also why Stars is typically bundled with a more desirable movie channel such as Showtime. I think Netflix has implicitly acknowledged this by concentrating their efforts on the back catalog.

I think the studios vision of the release schedule would work like:  Theater / "Same Day" Premium VOD -> BR/DVD Purchase, VOD/Digital Rental, Digital Purchase -> Premium Cable Channels / "Streaming Services"
Where "->" is a delay of some kind so each step can recognize maximum profits.

Netflix is actually 1080i with DD5.1 on the PS3 for those limited titles that were encoded that way.
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leo8877
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« Reply #156 on: September 26, 2011, 07:05:32 PM »

A guess on why the split is occurring:

http://www.outsidethebeltway.com/whats-really-behind-the-netflixqwixster-split/
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ibdoomed
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« Reply #157 on: September 26, 2011, 07:34:05 PM »

Quote from: leo8877 on September 26, 2011, 07:05:32 PM


I've always blamed the studios.
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« Reply #158 on: September 26, 2011, 07:34:49 PM »

how about another theory  icon_lol
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leo8877
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« Reply #159 on: September 26, 2011, 09:14:51 PM »

I just read that the netflix deal signed with dreamworks doesn't go into effect until 2013?!  That's a long time to wait to get new content.
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