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March 08, 2005

New Cheaper Netflix Plan

Also via TVPredictions.com, Netflix announced a new cheaper, $11.99 plan as an option for users. According to the story, the plan will be:

The cheaper, $11.99 plan allows two discs at a time and a total of four per month.

I don't want to be a naysayer, but I'm not sure this plan will be very successful. I can understand that there likely is a demographic of people who watch one DVD movie a week, but I think many people would find the four movies a month limit not worth the trouble of setting up an account and not having the flexibility of picking a movie at one's whim.

I think a smarter strategy would have been to have the typical entry level plan (e.g. 3 DVDs at once) start at $11.99 and charge users extra (eg $6) if they take more than four movies out in a month. That gets the people who are resistant to $17.99 a month in the tent to try out the service, and if you believe in the Netflix model (which I do), they'll quickly turn into full paying members without having to do anything.

Posted on March 08, 2005

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