Thursday, February 09, 2006

Netflix sends frequent renters to the back of DVD line

Via PittsburghLIVE.com:
SAN FRANCISCO (AP) --
Manuel Villanueva realizes he has been getting a pretty good deal since he signed up for Netflix Inc.'s online DVD rental service 2.5 years ago, but he still feels shortchanged.

That's because the $17.99 monthly fee that he pays to rent up to three DVDs at a time would amount to an even bigger bargain if the company didn't penalize him for returning his movies so quickly.

Netflix typically sends about 13 movies per month to Villanueva's home in Warren, Mich. -- down from the 18 to 22 DVDs he once received before the company's automated system identified him as a heavy renter and began delaying his shipments to protect its profits.

The same Netflix formula also shoves Villanueva to the back of the line for the most-wanted DVDs, so the service can send those popular flicks to new subscribers and infrequent renters.
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8 comments:

  1. This act of “throttling” made me wonder about my own account w/ Netflix. I have not been religiously watching how fast my orders have been coming, but I have noticed a few times, when I am watching to see which movies are coming next, that when I place two DVD’s in the post at the same time the two DVD’s appear on my account as having arrived at the different times. Thus I get my movies sent to me w/ a day or two apart. I don’t think that this day or two hold would be an issue for me, but to be told unlimited deliveries, and then hear about “throttling” because they want to keep their stock shares rise does disappoint me. I am also disturbed w/ ChrisCAD’s response. I read his blog as being just negative and rude to the other people that wish to post their comments and ideas in an open and non-personal judgement site. His blog was inconsiderate of RFC.; I don’t think of someone that is homebound because of a head injury as being lazy.

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  2. Many THANKS to everyone who posted.
    I will switch to Blockbuster ASAP!
    I just recently was THROTTLED by Netflix and didn't know it until I read about it today on the news~ Yahoo.

    What a sad thing....my movies have slowed down and my friend's too & he is retired older gentleman...neither of us knew about Netflix THROTTLE tactics.

    Again, thanks for all the good advice and therapy.

    Best of luck to all....tell your friends,
    & Netflix, if you are listening...change your practices and be upfront about your tactics.

    Thanks all!

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  3. I think that this is something that Netflix should have thought of before they launched the company. I think it's very unfair to treat your "best" customers this way.

    ~Maria Palma
    CustomersAreAlways.com

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  4. Ok, I'm a moderate Netflix user and haven't noticed that much throttling...a little sometimes, not much though.

    What worries me more, though, is that there seems to be a lot of "Hurray for Blockbuster" people posting here that don't seem completely honest. I'm a skeptical guy and I'm really wondering whether some of these people here are actually part of some viral marketing campaign by Blockbuster.

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  5. I think complaining about throttling is wack. The simple fact is that as a business matter, Netflix has to manage heavy renters. Resenting that fact is stupid. Before you go getting on the BB wagon, know that they will have to manage that issue too if their service achieves longevity.

    But the fact is that even if you are being throttled, you are still getting a good value on a straight money basis. If thats all that matters to you and its not enough then quit. But making all these statements about Netflix is evil and they are breaking their promises is junvenile and further, its OLD people. Quit if it bothers you that bad and the only interest for you is how good a bargain you are getting. In my opinion, Netflix is tops in service and value. I'll remain a customer, and I am a heavy renter and do experience so called "throttling". I just don't bitch about it all day.

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  6. So drop your service level membership from 5 out to less. We don't have to provide a better profit margin with less service.

    I can have a lower membership with both Netflix and Blockbuster and still win. Play the game and leverage their throttling tactics against them.

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  7. "But isn't it a valid complaint that Netflix is in effect cheating people by getting subscribers by offering an "unlimited" deal, then limiting the flow?"

    No, its not a valid complaint. Netflix's approach to managing heavy renters is reasonable. Heavy renters still receive a high level of service, even if they are throttled. Further, EVERY dvd by mail service has to manage this issue, and do it in the same way. Its a fact of the business. The complaining that goes on about it is simply the whining of people who just want to have their way and damn the company that provides the service's bottom line. We're entitled to good service for our money. The vast majority of us get that. They are entitled to make a reasonable profit and they do. If the value proposition is not satisfactory for the individual customer, they are free to cancel and go with a competitor or do without. But that is the correct response if you don't like NFX. CANCEL. But casting completely unfounded aspersions on the company and publicly dogging it as though they cheat, lie and steal from customers is completely without foundation.

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  8. I was a loyal member of Netflix, and after about 2 years of good service it started to happen. Movies would get lost in the mail, when I talked with Netflix they said check with your local post office (alright, how come everytime I ship a movie back it never get's lost?? They only get lost coming to me) - What Netflix was doing is holding movies, and telling me that they shipped it to me, that way I wouldn't get a high number of dvd's anymore. - By the time I reported the DVD lost in mail, and received another copy, a week or so had gone by. Netflix really let me down. - So I joined Blockbuster online, and so far I haven't had no major problems, they are a little bit slower at getting me the movies, and from time to time I have to wait for a dvd that is in high demand, but out of the six months I've been with them, no dvd's have been lost in the mail, scratched beyond play, or broken. Netflix can
    *****&^^%%*vulgar words&&((%%$$$

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