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Netflix To Charge 300% More For Blu-ray Discs

Mar 30, 2009 (12:03 PM EDT)

Read the Original Article at http://www.informationweek.com/news/showArticle.jhtml?articleID=216401811


Recession be damned -- Netflix on Monday disclosed that it's increasing the premium that subscribers must pay to receive high-definition Blu-ray Disc movies by 300% for its most popular plan.

Starting next month, the online movie house is raising the Blu-ray premium from $1 per month to $4 per month on its three discs at-a-time plan. Fees for other plans also will increase.

"The number of Blu-ray titles has increased significantly and will continue to do so," Netflix said in a note e-mailed to Blu-ray subscribers Monday.

"As we buy more, you are able to choose from a rapidly expanding selection of Blu-ray titles. And as you've probably heard, Blu-ray discs are substantially more expensive than standard-definition DVDs," Netflix said in the e-mail.

Under the new plan, subscribers who were paying $16.99 per month for three-discs-at-a-time plan, plus the $1 Blu-ray premium, will now have to pay $20.99 per month in total, representing a 24% overall increase in the cost of the plan.

Not surprisingly, many Netflix customers aren't happy with the price hike.

"I'm disappointed you've chosen to up the cost so much. $1 was fine, but I think it is a mistake for increases larger than $3," wrote a customer who identified himself as Keith on the official Netflix blog.

"It's good to see you're finally adding to the title selection, but with a cost increase of this size you're going to need to substantially increase your Blu-ray availability. The only movies with waits in my queue are Blu-ray disks," wrote Keith.

Another user, XenoChron, also complained that Blu-ray discs are often in short supply on Netflix.

"I hope the increase in prices is backed by an increase in availability. I'm still having repeated instances of Blu-ray being skipped in my queue because of demand. Can I assume this is going to end now?" XenoChron wrote.

Netflix rival Blockbuster Online doesn't charge extra for Blu-ray movies. The question is whether the company will hold to that policy in an effort to lure customers from Netflix, or institute a surcharge of its own in order to cover the costs of increasing its selection.