Netflix Content Costs To SkyRocket, New Suscriber Plans Start Today

Fierce Wireless reported this morning that Netflix content costs could rise from $180 million today to $1.98 Billion dollars in 2012.  With that announcement has come new price structuring from the content giant.

Effective today for new customers and September 1, 2011 for existing customers, DVD by mail and streaming are unbundling.  Netflix had a plan where you could pay $9.99 per month to get streaming and 1 DVD at a time by mail.  Now the cost of streaming is $7.99 and you’ll need to pay an additional $7.99 per month if you want 1 DVD out at a time.  The cost for two DVD’s at a time has gone up to $11.99 (in addition to your $7.99 if you’re a streaming customer)

More after the break

Netflix executive Andy Rendich explained in a press release:

“By better reflecting the underlying costs and offering our lowest prices ever for unlimited DVD, we hope to provide a great value to our current and future DVD-by-mail members.”

Despite the change in pricing Netflix shares soared past $300 in Nasdaq trading. Which only speaks to the popularity of the video service. Netflix debuted on a handful of Android devices earlier this year. A port of the Netflix app was quickly tweaked and distributed via XDA which gave Netflix support to most of the current, more powerful Android phones.

Last month the content partners that own Hulu announced that their service was for sale.  Google looks like one to be one of the companies in the forefront of those discussions.  Some found it odd that Netflix wasn’t in the running however this huge projected increase in content costs could be the main factor in that decision.

Source: FierceWireless, SAI



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