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film criticism by maryann johanson | since 1997

question of the day: What’s up with Netflix charging more for blu-ray rentals?

Netflix subscribers were surprised recently when the DVD-at-home service announced a price increase for access to blu-ray rentals. The sliding scale increase — if you’re on the 3-at-a-time plan, you pay an additional $4 per month; if you’re on 8-at-a-time, you pay a whopping $9 more — applies merely to have blu-ray discs in your rental queue, even if you don’t actually receive a single blu-ray disc in a given month. And with the long waits Netflix’s blu-ray customers have been reporting, not actually receiving a single blu-ray disc in a given month is a frequent occurrence.

Don Reisinger at CNET’s The Digital Home called bullshit on the fee increase:

Predictably, many looked at the announcement as Netflix capitalizing on consumers. Those who are upset with the release say the increase is too high. And since Netflix doesn’t need to pay for packaging, and it probably gets a discount on media, given the number of copies it needs, they believe that the company is gouging customers.

I contacted Netflix for comment regarding this contention. A representative responded to me within a few minutes. He said the cost of Blu-ray discs is 30 percent higher than that of DVDs, and more of the company’s customers are switching to Blu-ray, generating higher operating expenses. A $1 additional charge for Blu-ray access on all plans wasn’t cutting it any longer, he said.

The representative then directed me to the company’s official blog post on the matter for more information. So after all that, we still don’t know how much Netflix pays.

Be sure to read that official blog post at Netflix. The 100-percent unanimity of the comments that follow is a rarity for the Web: everyone is pissed at Netflix.

Phil Villarreal, the film critic at the Arizona Daily Star, sees this move as a sneaky way for Netflix to drop blu-ray altogether:

[I]f you’re not entranced by 1080p it would be foolish to consent to the $4 tack-on. Upconverted DVDs look pretty damn good, after all, in 480p. I see this as a move by Netflix to get people to stop asking for Blu-rays and thus justify no longer having to carry them.

Could that be it? If Netflix wanted to eliminate its blu-ray, this does seem like one way to do it. But why would it want to do that in the first place?

What’s up with Netflix charging more for blu-ray rentals?

(If you have a suggestion for a QOTD, feel free to email me.)

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