Netflix To Go Back Into Price War Mode?

from the ad-supported-movie-rentals dept

Davis Freeberg writes in to tell us about Netflix's CFO's recent investor presentation where he talks about a few upcoming moves that the company is testing out. A year ago, we noted that the online DVD rental market was entering price war mode, with Blockbuster and Wal-Mart trying to attack Netflix and rumors of Amazon's impending entrance swirling everywhere. Since then, a lot has changed. Blockbuster decided that the price war wasn't working and raised prices, Amazon had second thoughts about entering the DVD rental business and Wal-Mart gave up and just outsourced DVD rental to Netflix. However, in the presentation, it sounds like Netflix is thinking about dropping prices again -- with the CFO saying that he thinks the market is price elastic, and lower prices would put more pressure on Blockbuster. While this might not line up with previous stories that suggested Netflix and Blockbuster had different types of customers (Blockbuster more about theater releases, Netflix more about indie releases), he explains that away as well by saying that Netflix's power is in convincing any customer that they may like other, lesser well known movies. Of course, he's spinning things to make a strong case for Netflix -- which is his job -- so take it all with a large grain of salt. The other interesting part of the talk (though, not quite the "bombshell" the writer makes it out to be), is that Netflix may look to subsidize movie rentals by adding advertisements to the site itself. Considering the online advertising market these days, that's not surprising at all, but to be expected.


Reader Comments (rss)

(Flattened / Threaded)

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    Bret McDanel, Nov 16th, 2005 @ 10:48pm

    No Subject Given

    There are alternatives to netflix. Some even provide games and other content that netflix does not. www.intelliflix.com is one such company. And they do netflix only competyition for about $9/month. Much better price with about the same number of titles.

     

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      LaidLaw, Nov 17th, 2005 @ 1:20am

      Re: No Subject Given

      Not a Intelliflix fan myself. I even double checked to see if they got any better. My only source of entertainment right now is Netflix. I subscribe to their 5 at a time plan. I keep A balance of movies, TV shows, and music DVDs on hand.

      Of all the titles that I have out right now, intelliflix has 2. Of the titles that are in my top ten, Intelliflix has 4. There is a reason why they cost less.

      To be fair, Netflix doesn't offer games for rent - which doesn't matter to me as I don't even own a gaming console.

      And to put in my $.02 worth on NetFlix in general, they have a great system for helping you find things, and they have a great selection of hard to find titles. And while they have a great collection of indie stuff, they also have all the popular titles as well. If you are the type who enjoys TV on DVD, then NetFlix seems to be unmatched. If it has been out, they have it. Including America's Greatest Hero, Monty Python's Flying Circus, the list goes on and on!

      Kudo's to Netflix for its selection and service. Remember, if you find something out there that is cheaper: there is a reason.

       

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        Tom, Jan 27th, 2006 @ 8:56pm

        Re: No Subject Given

        I will admit I got sucked in by the "act now" ploy, but intelliflix is bad and should have lawsuits against them for miss leading ads. Nowhere in their terms does it say popular movies are not avalible, but they make it real hard to get your money back when you are not satified.
        I went with net flix as I was canceling IF and NF is great fast and suggested movies that I never thought of.don't bother with IF let them go out of biz.

         

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      Anonymous Coward, Nov 17th, 2005 @ 8:34am

      Intelliflix

      Yea, scour the net for reviews abotu intelliflix. There are many complaints of peopel being charged for movies that arrived damaged, movies taking a week to arrive [when intelliflix sys they have more distribution centers then netflix], and they have several BBB complaints, and are not even a BBB member.

      Color me unimppressed.

       

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      Brian, May 31st, 2006 @ 5:22pm

      Re: Intelliflix is a scam

      Intelliflix is very slow in shipping and will rarely ship games. After I complained they started sending broken discs. I've gone three weeks without a working DVD or game. They have sent 7 defective titles in a row.

       

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      Bill, Oct 31st, 2006 @ 10:52am

      intelliflix sucks

      I have been an intelliflix member for almost a year and they have screwed me arround from the start.
      I have never had 3 DVD's at time which is what I signed up for. There suppot tickets are useless- better of banging your head on a wall. They never seem to have the titles I request(and many are older) and they ship from across the country. I'm convinced it is to limit how many DVD's theya send out. They suck -

       

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      Carol Stone, Dec 29th, 2006 @ 11:37am

      Re: No Subject Given

      i think it was a got ider,it was good you took that change.

       

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      Lori, Jan 30th, 2007 @ 10:51am

      INTELLIFLIX

      This company is the biggest ripoff ever. Do not believe the hype, or the advertisements. Avoid at all costs, or you will be incredibly sorry. I am..........

       

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      Frank, Nov 3rd, 2007 @ 10:06am

      Re: No Subject Given

      Intelliflix sucks

       

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    Joe Schmoe, Nov 17th, 2005 @ 8:19am

    No Subject Given

    I'd rather they did not throttle supposedly "unlimited" accounts, than piss around in a price war over a dollar or three a month...

    Took a quick peek at the intelliflix link above. Of note is their Mature Content availabilty. Didn't dig into the pricing of the site but would not be surprised if they make up for their other wise low subscription rate by pricing those titles at a premium rate.

    A WHOIS lookup will show that "NetfliXXX.com" has been registered to Netflix as well, but is going un-used as of yet...

     

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    RobertS, Nov 17th, 2005 @ 8:49am

    GreenCine for movies

    I highly recommend GreenCine and I've been a happy customer for a couple years now. They have a great selection of foreign and indie films, video-on-demand and of course the requisite big films of our time. Also, they have fantastic customer service and very fast movie deliveries (of course it helps that I live 20 miles away). They also give a portion of revenues to independent filmmakers. Finally, their prices are in line with NetFlix. Check them out: http://www.greencine.com

     

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      MindTrigger, Nov 17th, 2005 @ 9:08am

      Netflix

      I've been using netflix since '01. Easy to use site, and generally good service. The only complaint I have recently is that they seem to have more delays when new movies come out. This needs to be taken care of.

       

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        Anonymous Coward, Nov 17th, 2005 @ 9:56am

        Re: Netflix

        If your a high volume rental they do this. If you know a friend who is less high volume renter then you have them add a few of the 'Wait' movies from your queue to theirs, see if they really have a wait. It's really frustrating.

         

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          Joe Schmoe, Nov 17th, 2005 @ 10:15am

          Re: Netflix

          Frustrating yes. But they're selection and convenience still make up for it...

           

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          TJ, Nov 17th, 2005 @ 7:10pm

          Re: Netflix

          Being a long time customer I read a good deal about this when it started being discussed. At first it was a concern, but then I read just how quickly 'throttled' people were churning discs. To me how Netflix handles it seems balanced. If you have a _pattern_ of renting/returning so quickly that a disc rental falls somewhere below 50 cents the system slows your delivery down a little. Would it be better to absolutely limit the number of discs a month, or send nastygrams, or raise prices?

          I want to see the big movies as soon as they are released, so I keep my monthly usage to where it comes out to about 75 cents a disc. That is still plenty of movies too watch, sometimes its still too many. Only once in a year have I not gotten a new title when it released, and that was a fringe indie that has been at 'very long wait' for weeks. So I pay a good deal less for new movies than at a rental place, never have to step foot in a rental place, and can keep certain movies as long as I want when I want. But if I started consistently returning movies so fast that the service fee barely covered the postage then Netflix would be foolish not to rate limit me a bit.

           

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            NetFlixLover, Nov 17th, 2005 @ 11:49pm

            Re: Netflix

            I'm a high volume renter. I have movies, TV shows, music and documentaries going through the mail every day. I have never met a shipping delay, except through the post office. There have been times that I had to wait for a new release to show, but that doesn't bother me so much. Once I had to wait almost three months for a new release, and that was for "Ray". Most of the time, if there is a delay, it is only a couple of days.

             

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    Barry, Nov 20th, 2005 @ 9:28am

    GAMEZNFLIX

    Heard of GAMEZNFLIX? Just partnered with Circuit City. Movies and Games. Check it out.

     

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    Anonymous Coward, Apr 6th, 2006 @ 2:00pm

    Intelliflix Sucks!!!!! Dont Get Ripped Off!!!

    My husband and I were happily with Netflix for a year, then we moved out of state. Unfortunately, we had to cancel our subscription for the time being. When we arrived at our new home my husband saw the "Intelliflix" website and suggested we use them instead because "they were SOOOO CHEAP!!" I thought it was a good idea at first. It wasnt until a week after we joined that we received the first movie on our cheque (Netflix takes about 1 day to send your first dvd's). I was pissed. We live in Texas now and we had already paid for the year in advance. We live in the center of the U.S. and it still took forever to get in the 1 movie at a time (and we had the 3 out at a time plan!!). I did my research...too late like and idiot. I found out that there are hundreds of complaints on the web about Intelliflix and how they have been ripping people off. They never returned money, some people have given up waiting. We felt like such idiots. We tried to cancel our account. It has been a month and they still havent cancelled our account. There is no phone number to call them and they wont respond to our emails.
    Dont get suckered in to this stupid company because it is cheaper. Remember...you get what you pay for. We are back with Netflix now and I dont have a single complaint. We always have an overflowing amount of movies pouring in all the time and I will never stray from them again. My husband learned his lesson big time since he paid in full with his credit card. INTELLIFLIX SUCKS!!! RESEARCH CUSTOMER COMPLAINTS BEFORE THINKING OF JOINING!!! DONT GET SUCKERED!!

     

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      Sucker, Jun 8th, 2006 @ 6:52pm

      Re: Intelliflix Sucks!!!!! Dont Get Ripped Off!!!

      Same deal here, too on Intellifix. Buyer beware. Usually I feel confident that I can do a chargeback on the credit card. This time I let my better judgement go by the wayside and use the PayPal Debit card because Intelliflix $'ers didn't take American Express.

      Chock PayPal and the no way to dispute up to the same category as the intelliflix scoundrals.

       

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    Fell Victim, Apr 15th, 2006 @ 5:10pm

    I too was suckered by Intelliflix

    Don't fall victim to Intelliflix's cheap price. I was pulled in by their "SuperPass", only to find that "unlimited" rentals actually mean about 5/mos. Even if you return them the day after you receive them, they'll wait a week before shipping out a replacement. And forget about getting anything at the top of your queue. You'll need to put 30 titles in it to find one that actually exists.

    I was able to get a refund, but they prorated it at such a high rate that I ended up getting screwed even worse on my way out the door. Danny Carrao tries to play the nice guy, but he's a shyster to the extreme.

    Check the BBB and see their record. If you also have gotten screwed, report them to the BBB, the FTC and the Florida Attorney General. Let's shut these scoundrels down!

     

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    EileenF, Jun 16th, 2006 @ 12:30pm

    Intelliflix Customer Support

    My Name is Eileen and I am with Intelliflix Customer Support.

    We take pride in being able to offer our customers a TOTAL package of Movies and Games.

    Intelliflix is the world’s largest combined online movie and game rental destination, offering more than 60,000 titles of movies and games to customers throughout the United States. Our goal is to provide our customers with the Ultimate Video Store Experience.

    Intelliflix knows that one plan does not fit all…each of our customers are unique and have their own lifestyles and preferences. By offering a traditional video store pay-per-rental plan starting $4.26 (rent one at a time) in addition to the standard unlimited subscription program, our customers enjoy what they want…when they want.

    In addition to that, we’ve launched our 24 Hour Video Store, which gives you the ability to look at the real-time inventory of your local video store to see what they have on the shelf, right now and rent it. You can have it mailed to you, or you can even have it packaged for you using our exclusive FastPass Counterside PickupTM just stop by the store to get it in as few as 15 minutes from when you place your order! Now that’s fast! Check out our 24 Hour Video Store at www.24hourvideo.com and see if your local video store is online!

    Customer Satisfaction is our #1 PRIORITY.

    I am sorry to hear of your experience with Intelliflix.

    I would like the opportunity to turn around your experience.

    Please contact me at eileen@inc.intelliflix.com with your specific account information (name and E-mail address). This will enable me to review your account and contact you directly.

    Looking forward to hearing from you. Eileen

     

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    Andrea, Jun 19th, 2006 @ 11:00am

    I realize you are trying to use a public forum to make it look like Intelliflix is trying to fix the situation, but those of us who are or were customers know better. WHY DOESN'T INTELLIFLIX ADDRESS THE SITUATION BEFORE IT GETS TO PUBLIC FORUMS?


    In the two short months my husband and I were members, I can say in all fairness that Intelliflix is the worst service of any type. Not just the worst online service, not just the worst mail-order service, but the WORST ALL AROUND! We should have checked the BBB and dvdrr.com ratings from the beginning.

    About 1/3 of the titles we ordered were broken. I mean really broken - cracked and split. Customer service makes virtually no effort to remedy the situation; if a disc is broken - which is Intelliflix' fault for not having any quality control - you take the consequences. Not only do you not have something to watch, which is what you're paying them for, but your entire queue gets held up until the replacement is received by Intelliflix.

    Shipping times were atrocious, with 2-4 days each way. With Netflix and Blockbuster (we are going back to Blockbuster), shipping was one-day each way.

    Why is it Intellifix ships out so many broken discs? Why is it you don't try to fix the situation and ship the customer's next-in-queue as well as the replacement disc? After all, it's not our fault Intelliflix has no quality control. And why is it even your corporate office (561-697-8325) doesn't seem to know what's going on?

    Oh, since you mentioned 60,000 titles, why is it that so many of them are always "unavailable"? Regardless, you could have 1 million titles - with the quality-control and problems there, it means nothing. Judging by my own experience, as well as reports by Better Business Bureau and numerous other ex-Intelliflix customers on various review sites, Intelliflix is not only the worst online DVD rental service, but possibly the worst service of any kind.

     

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    JT, Sep 7th, 2006 @ 3:41pm

    Who the hell is EileenF

    EileenF goes around putting the same message up on every board. This is a most informal thing to do. Rude to tell you the truth.Not even enough time to really care . No true comments to make as to the complaints on any of these forums. And if there is a rating system for her to use she alway gives intelliflix FULL MARKS.Eileen, aren't you paid to say these things?

     

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    JA, Oct 4th, 2006 @ 7:07pm

    Intellicrap

    Intelliflix has actually caused me phychological harm. I think I need to see a shrink to release all the stress and anger I am having trouble coping with. I regret ever signing up with them. I just want my money back. Damn it I feel like a fool.

     

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    torrey, Oct 23rd, 2006 @ 10:30am

    Another victim of Intelliflix

    I agree with all the people who feel ripped off. I purchased a Superpass Subscription back in March of 2006. Unlimited rentals!!!___Oh, please!___I had DVDs returned for 3 days and no new ones sent out. I had requests for new releases that were 5-6 weeks old and never filled. I returned a defective DVD and was sent back the same defective DVD!
    I canceled my subscription back in June of 2006. Even though it states in their policy that Superpass Subscribers will get their money refunded right away, I still haven't received any refund. It is now October.

    Customer service!!!___I have more ticket #s than I can keep track off. They won't give you a phone number to call to resolve any issue. They just issue another ticket #__a computer generated response__saying "I've escalated your request to the billing department for immediate attention. You will be receiving an email soon with regards to the
    status of your refund. Sorry for the delay." BULL!!!

    Don't get suckered by their website!!! That NBC story looks good__citing Consume Reports__don't believe it. I can only warn you!!

     

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      torrey, Oct 23rd, 2006 @ 11:18am

      Re: Another victim of Intelliflix

      After reading the comment I just submitted, I need to correct one statement. Instead of saying that Intelliflix policy states that a Superpass Subscription can get a refund right away. I should have said that Intelliflix Terms and Conditions state that your can cancel at any time. Does that imply an immediate refund? Does the email reply I quoted imply an immediate refund? You can be the judge.

      Maybe someone should ask Intelliflix if their business model isn't in part, selling prepaid subscriptions, that if canceled, can finance current operations until they get around to giving a refund. Sort of an interest free loan. Does that sound possible?

       

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    Bill, Oct 31st, 2006 @ 10:54am

    Intelliflix SUCKS !!!!!

    I have been an intelliflix member for almost a year and they have screwed me arround from the start.
    I have never had 3 DVD's at time which is what I signed up for. There suppot tickets are useless- better of banging your head on a wall. They never seem to have the titles I request(and many are older) and they ship from across the country. I'm convinced it is to limit how many DVD's theya send out. They suck -

     

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    Frank B., Nov 17th, 2006 @ 11:01am

    I had about 70 movies in my queue and ALL the movies in my back-up queue simply VANISHED !!! The back-up movies are the ones I REALLY want to see but I don't think I ever will....

     

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    Carol Stone, Dec 29th, 2006 @ 12:01pm

    intelnetflix

    I AM NOT A MEMER YET AND WHAT I READ I DONT THINK I WANT I AM GAL YOU GUYS CAME ON AND TOLD ME ABOUT IT THANK YOU

     

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    Lori, Jan 30th, 2007 @ 11:08am

    INTELLIFLIX SUCKS !!!!!!!!!!!!!!!!!!!!

    This is the most fradulant company ever. Avoid at all costs! I am bitter and fell like such a sucker. At least I'm not the only one.

     

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    Ron, Feb 12th, 2007 @ 2:56pm

    Intelliflix Petition

    Maybe everyone who is unsatisfied (including me) should start a petition for a class action suit against this company Intelliflix for failing to deliver satifaction to their customers with a real customer support and a constant flow of movies,games or whatever you signed up for.Lots of TV stations will investigate a company when people are unsatisfied with them and run it as a news broadcast if they are contacted about such poor service.

     

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    Christopher, Mar 15th, 2007 @ 5:13am

    Intellisuck Cancelation

    Does anyone know how to get them to cancel a subscription????

     

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    Christopher, Mar 15th, 2007 @ 5:13am

    Intellisuck Cancelation

    Does anyone know how to get them to cancel a subscription????

     

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    Movie lover, Apr 11th, 2007 @ 12:21pm

    Intelli-screwed

    Christopher, and everyone else dealing with Intelliflix shady business practices, contact the Better Business Bureau of SEFlorida at http://www.bbbsoutheastflorida.org/

     

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    Bob, Apr 12th, 2007 @ 4:07pm

    bad service

    I have had a similar experience as psoter 24. Delivery is slow, website does not function as described and instructed and don't plan to get the titles from the top of your queue. If you start a complaint ticket on Friday you won't be hearing back until at least Monday so if you get a bad dvd don't plan on getting a replacement soon I made a big mistake signing up for a year. They won't give my money back so here I am letting the world know about them.

     

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    CHERYL, Jul 18th, 2007 @ 8:50pm

    INTELLEFLIX VICTIM

    DO NOT, DO NOT, DO NOT JOIN INTELLEFLIX. I HAVE NOT RECEIVED ANYTHING FROM THEM IN WEEKS ITEMS IN MY QUEUE ARE FROM DECEMBER 2006. I HAVE SENT 5 EMAILS ASKING FOR A REFUND NO REPLY. I WISH HAD FOUND THIS WEB SITE FIRST.

     

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    Christina, Aug 16th, 2007 @ 1:52pm

    IntelliSUCKS

    Those capitalist bastards are ripping people off. The service sucks and the customer service reps are all drones. They are probably all Danny Carrao's family members. I want a refund and those greedy lying bastards won't give it to me!

     

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    michael, Sep 11th, 2007 @ 10:46pm

    Intelliflix vs Netflix

    I tried to be as honest as possible when comparing intelliflix with netflix, so I listed the pro’s & con’s of each service. With netflix I have the rent three at a time with a monthly deduction from my bank account. With intelliflix I have the three at a time movies, xxx, & games paid by the year at a discounted rate. I read the consumer reports review that rated intelliflix higher than netflix, I already had netflix and I was not satisfied when the new releases were put on waiting lists. I cancelled the netflix account and then I bought the intelliflix plan. At the beginning I was happy with intelliflix, I was getting all the movies I requested. A month later there service was absolutely unacceptable and after numerous e-mail complaints I re-ordered netflix and tried to cancel intelliflix. I e-mailed intelliflix stating I would like to cancel the membership and they wrote back that they would not refund any portion of the payment, but they would cancel the service at the end of the agreement in 10 months. I figured I would make the best of it and use the two services. I will now list the pro’s and con’s of each service. Intelliflix: Pro’s: quick response from customer service e-mails, innovative feature that lets you click that you sent back the movie and they start shipping the next title in your querie; (limited to 1 time per 3 movies), they have game rentals for consoles and xxx movie’s, and if you pay by the year they give you a discount. Con’s: Slow turnaround, slow shipping (5-10 days), slow returns, unplayable or broken cd’s, dirty cd’s (I clean them and then they will play), lost cd’s when I return them, pre-written responses to customer service requests, new releases seldom available, I have to contact customer service every time I want movies sent from my querie, new releases are seldom available. Netflix Pro’s: Fast turnaround, fast shipping, fast returns, bigger selection of movies, better search engine when looking for movies, better website design, can put future releases in your querie and it will list the release date and then send you the movie when it is released, innovative feature that allows you to watch a movie instantly over the computer and it does not matter if you have 3 movies out and there is a friends list that allows you to add friends on netflix and share your reviews of movies you watched.
    Con’s: New releases sometimes have a waiting list, computer generated responses from customer service, online viewing has few new release titles and limited selection; but they are constantly increasing the library. I would rate Intelliflix 1 star and Netflix 7 stars, but in comparing the services: Intelliflix would get 1 star and Netflix I would rate at 10 stars. I have not had any movies from my querie sent from intellitflix in a month, because I have not written customer service complaining, which is the only time they send movies. I have 30 titles in my querie and 10 state they are available, none are being sent or out at this time. It takes 3 days total from Netflix: the day I send it, the day they receive it, the day I get it. If you are going to try intelliflix, take it from me, pay by the month so you can cancel the service, because it is absolutely unacceptable.

     

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    Chris, Oct 3rd, 2007 @ 3:20pm

    Intelliflix is a complete joke

    I signed up for a year with Intelliflix, well in the last 90 days with over a hundred movies in my QUE, I have only recieved ONE MOVIE, their customer service is a joke, and all thier responses are lies. The President published his email in the monthly newsletter, and said "what other company would do that", Well the next month the first item in their newsletter was how THE President was not customer service, and his email address is no longer published.

    I am tired of fighting with Intelliflix, it's a hard lesson at the price, but hopefully by reading this post someone else waon't make the same mistake.

     

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    Ed, Oct 19th, 2007 @ 1:36pm

    Intelliflix

    Just to let you know legal action is filed by the Fla Attorney General against Intelliflix
    Case LO7-3-1010

    Office of the Attorney General
    Jeffery Dikman
    1515 North Flagler Drive
    Suite 900
    West Palm Beach, FL 33401

    Fax 561-837-5109

    I do not think they know how many were mislead. I sent them my history of emails and rental (or lack of) history.
    Intelliflix has changed their rental argeement several times in the last 60 days to cover up what they have done.

    If you lead this in Nov or Dec of 2007 I would suggest you share with them also.

    By the way they never registered to do business in Florida either.

     

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    Kenny, Feb 3rd, 2008 @ 11:47am

    Intelliflix

    I've e-mailed Intelliflix just about everyday for a week inquiring about the website and my next movie but, I got nothing. Now, they are refusing to respond to my latest support request and my e-mails are not being delivered from their website nor from my e-mail account. They suck. The only reason I renewed this terrible service was because when my original service ran out, they tried to charge me $50 for two movies they said they never received. So, instead of paying them for the two movies, I renewed at two-a-month which was roughly about the same amount of money. Of course, they suddenly received the movies and now I'm just trying to make the best of this contract. I have about four months left with these guys and I already have plans to make sure not to rent anything too close to the end of this agreement so that I won't get screwed again. (Provided that they ever send me another movie again. They keep putting every movie in my queue into a waiting area. Even older movies and B-movies. C'mon, does anyone really want to see Undisputed with Wesley Snipes?) Oh, and by the way, they are allegedly updating their database which is why the website has been messed-up for the past month. But, I have Netflix and they seem to be able to add new movies every Tuesday without any problems. Netflix is awesome. Intelliflix sucks!!!

     

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