Netflix increase ?

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#2162067 16-Jan-2019 16:20

Looks like the standard HD plan is going up to $13 US which is ~$19 NZ (currently $14.99 NZ). I wouldn't be surprised if we get hit with another increase this year.

Only the kids watch Netflix. I prefer the selection of TV shows on Lightbox and TVNZ OD. I'm looking forward to Disney+ (assuming it launches in NZ). It will supposedly be cheaper than Netflix.

gehenna

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#2162074 16-Jan-2019 16:40

rugrat:

Wondering if it’s going to be replaced with DC content.

CW seems to have DC fairly well wrapped up.

Finch

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#2162169 16-Jan-2019 18:20

muppet:

YES! Been waiting to this for a while, glad to see it's finally happening.

Typical that it's rolling out in the US first of all, hope it arrives in New Zealand shortly.

Huh? You have been looking forward to a price increase?

ANglEAUT

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#2162294 16-Jan-2019 20:52

Senecio: ... With the amount of content available for free via legitimate On-Demand services these days ...

Emphasis mine

Senecio:

Netflix Premium $18.49
Fanpass via Spark $30.00
Lightbox via Spark $Free
Spotify Premium $22.50
PSPlus $90.00/year

That is not my kind of free.

Please keep this GZ community vibrant by contributing in a constructive & respectful manner.

ANglEAUT

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#2162298 16-Jan-2019 20:57

tdgeek: Which ones? ...

TVNZ = ads
TV3 = ads
Lightbox = cost for me
Netflix = No ads

Ladies & gentleman, we have a winner!

Please keep this GZ community vibrant by contributing in a constructive & respectful manner.

tdgeek

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#2162399 17-Jan-2019 08:45

IcI:

tdgeek: Which ones? ...

TVNZ = ads
TV3 = ads
Lightbox = cost for me
Netflix = No ads

Ladies & gentleman, we have a winner!

Unsure of your point. Which ones was in the context of

Senecio:

With the amount of content available for free via legitimate On-Demand services these days

Which ones? TVNZ, TV3, Lightbox (if you get that free)?

Any others?"

Netflix is not free.

Interesting that you find no ads more valuable than ads. While all will agree no ads is better than ads, we watch the content, content is key. It seems you prefer any content, not the best, as long as there are no ads, and a price is ok too.

rugrat

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#2162537 17-Jan-2019 12:58

Ads can ruin the enjoyment of watching content - they interrupt the flow, having content people want is useless if viewing experience is ruined.

Light Box has no ads same as Netflix.
Spark is more expensive then other providers, so even if not directly paying for Light Box, people are still paying for it.

Content is not everything, presentation of content is important as well and Netflix excels in this area.

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Senecio

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#2162577 17-Jan-2019 14:34

IcI:

Senecio: ... With the amount of content available for free via legitimate On-Demand services these days ...
Emphasis mine

Senecio:

Netflix Premium $18.49
Fanpass via Spark $30.00
Lightbox via Spark $Free
Spotify Premium $22.50
PSPlus $90.00/year

That is not my kind of free.

I never said it was free. I listed out my current entertainment subscriptions, the free stuff is available in addition to what I'm paying for. The point was, of the stuff I am paying for, Netflix is the least used and therefore the most likely to go next.

networkn

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#2162587 17-Jan-2019 14:56

If Sky increased it's price by anywhere NEAR 18% Geekzone would break with the number of outraged complaints! LOL.

rugrat

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#2162615 17-Jan-2019 16:01

networkn:
If Sky increased it's price by anywhere NEAR 18% Geekzone would break with the number of outraged complaints! LOL.

Netflix is a relatively low price, 18% on a higher price is more $.

If they do it to often it becomes different story, also if Disney and others start streaming here I won’t be subscribing to every service at same time, will be chopping and changing depending what want to see each month so Netflix might not have as an easy ride in the future.

dafman

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#2162617 17-Jan-2019 16:05

networkn:

If Sky increased it's price by anywhere NEAR 18% Geekzone would break with the number of outraged complaints! LOL.

Sky pricing already Sky-high. 18% would push them into orbit.

networkn

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#2162621 17-Jan-2019 16:07

18% is 18%.

ockel

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#2162653 17-Jan-2019 16:34

rugrat:
networkn:

If Sky increased it's price by anywhere NEAR 18% Geekzone would break with the number of outraged complaints! LOL.

Netflix is a relatively low price, 18% on a higher price is more $.

If they do it to often it becomes different story, also if Disney and others start streaming here I won’t be subscribing to every service at same time, will be chopping and changing depending what want to see each month so Netflix might not have as an easy ride in the future.

This is the second substantial price increase by Netflix in the last 15 months. Its not a surprise (although no grandfathering on this increase is a surprise) and pushes Netflix closer to being a sustainable business. I would have expected that this year Netflix would have hiked its international prices and leave its US prices for another 12 months (Oct 2015 by 11%. Oct 2017 by 10%, Jan 2019 by 18%(?)). The standard plan is now 60% higher than when it launched. Looks like milking the existing base before more competition kicks in from Disney, NBCU etc etc

Its classic behaviour - launch a product at a loss-leading price to gain first mover advantage. Hit critical mass and then steadily rachet up the price to move to a cashflow positive position. Keep hiking the price up and ascertain customer reaction - if Netflix doesnt see a 18% hit to revenues over the next 12 months (and remember it can see who churns on and off, how long a customer stays paying the higher price) then it'll look to keep increasing its prices. And it will do so beyond the point of cashflow postive until its cumulative ROIC (remember is has to recoup the investment cost of its accumulated losses) is at an attractive (>WACC) level.

If Netflix gets no customer pushback it'll recoup $1.4bn in additional revenue. Thats still not enough to fill the cashflow hole that its in so you can bet your bottom dollar than there'll be more consistent price increases in the future. In 10 years time its not inconceivable that it'll be more like US$25/mth for a standard plan.

Netflix has got its FMA by virtue of low prices, aggressive marketing and leveraging off unutilised back catalogues before adding its own. But its Achilles heel is the absence of barriers to entry. The same thing that let it get started against the cable companies means there are no barriers to other media beasts from entering the market and using their clout - and there are no barriers to people churning away from the [new] incumbent.

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#2162883 18-Jan-2019 08:10

Will be interesting to see if any of these services adopt contract pricing. Lower price on 6 or 12 months, in order to reduce churn when they are competing with a growing number of other SVOD providers. Or allow users to hop on and off every few weeks, or days

ajw

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#2162924 18-Jan-2019 09:25

Senecio:

tdgeek:

Which ones? TVNZ, TV3, Lightbox (if you get that free)?

Any others?

Yes, I'm a Spark customer so Lightbox is part of my plan. I also use FanPass for $30/month for live sport since cancelling my Sky subscription last year. After watching the nightly news and live sport I don't have much time in front of the TV so those services provide me with more than enough content to watch. To be honest I probably watch more on YouTube than any other service these days. There are some great content creators in genres that interest me on YouTube.

My current entertainment subscriptions are (not including broadband):

Netflix Premium $18.49
Fanpass via Spark $30.00
Lightbox via Spark $Free
Spotify Premium $22.50
PSPlus $90.00/year

From those services and free On Demand I use Netflix the least.

I share my netflix 4K subscription with three other people to keep the cost down.

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