Friday, September 2, 2011

Is Netflix in Trouble?

There could be trouble ahead for Netflix. The popular DVD and streaming service recently raised rates, effectively doubling rates for anyone who wanted to continue with 1 DVD out at a time and unlimited streaming.

That was a deal breaker for me. Netflix had long touted the streaming feature as FREE if you signed up for their DVD service. Doubling the rates while the recession of 2008 continues is just dumb.

Now STARZ has announced its ending it partnership with Netflix.

See: Netflix, Starz to break up: One crazy ride ahead to Feb. 28

As if the churn rate from doubling rates wasn't bad enough, the end of the relationship with STARZ could mean more trouble ahead for Netflix.

Where once there was no competition - there are competitors everywhere now - from DVD rental to on line streaming. Netflix should have had a plan to keep existing subscribers happy. Doubling rates was definitely not a good plan.

So it goes.

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