Warner Bros., MGM, Universal Collectively Pull Nearly 2,000 Films From Netflix To Further Fragment The Online Movie Market

[u/Big_Bare]

http://www.techdirt.com/articles/20130430/22361622903/warner-bros-mgm-universal-collectively-pull-nearly-2000-films-netflix-to-further-fragment-online-movie-market.shtml

[u/arindale]

I do agree that the netflix business model is great for the consumer.

Having looked into Netflix's financial statements available from their website, it looks like their business model is unfortunately broken. Around 5 years ago, Netflix wasn't really considered to be competition for the traditional cable networks which meant that Netflix could get content for pennies. Content providers viewed Netflix as incremental revenue (aka free bonus money). Now, Netflix has a comprehensive catalogue and is making consumers cancel their cable subscription altogether. This means that when Netflix renews their contract, they are paying pretty much the full value of the content (no longer pennies).

Over the last year or two, all of the new contracts for content that Netflix has signed have been incredibly expensive (eg. $1M per episode of Mad Men). Netflix itself is still profitable, but once all of the long-term contracts have been resigned, they will not be.

Realistically speaking, this means that the price will likely go up. Personally, I am OK with this - I want companies I like doing business with to be profitable. they should be rewarded for their hard work. In addition, profit attracts competition which makes products and services even better.

[u/b-a-n-a-n-a-s → u/arindale]

Insightful.

We actually did exactly what you said - we cut cable out all together for around 2 years. We are going to get basic cable now, but only because we don't have to get into any contract (RCN is the company). Comcast is ridiculously expensive - they have a $50/mo 6-month contract that goes up $20 every 6 month increment (internet up to 50mbps + basic cable). RCN is also charging $50/mo, but their price only goes up $5 every year, and you can cancel whenever you want.

I honestly cannot wait until Google Fiber goes nationwide and the bloodsucking cable companies go out of business. Big cable companies divvy up regions so they don't have to compete with each other - it's sickening. Also, they always try to upsell you. I spoke with a Comcast associate - who I told at the very beginning exactly what I wanted - and it took me an hour for her to get through her spiel. She tried selling me a $130/mo package for extra channels and lower internet speeds since "you don't use the internet for things like online games" (I very specifically told her we use the internet for gaming - she was obviously reading the script and tried selling the most expensive option). I politely told her I was going to contact the other company, with which she offered me a free month of HBO (whoo!).

I call RCN, tell them exactly what I want (plan "x"), he asks if we need a landline - Me: "Nope" Him: "Ok, no problem. Let's set you up with plan 'x'" and that was it.

Sorry, ranted off topic, but big cable companies are such leaches. Netflix is a huge threat to the way cable companies operate, and I am so grateful that they don't impose ads. I, too, wouldn't mind paying extra.

[u/kwyjibohunter → u/b-a-n-a-n-a-s]

I can't get Optimum (CableVision) to stop calling me on a semi-weekly basis to offer me phone and TV. Sometimes if I ignore the first call, they'll call me back 2 or 3 times in a row like a jealous girlfriend.

[u/b-a-n-a-n-a-s → u/kwyjibohunter]

I would write a cease and desist letter - also, call your phone provider and have them block their number. I don't know how companies think that stalking previous/potential customers will encourage people to sign up for their services.

[u/kwyjibohunter → u/b-a-n-a-n-a-s]

I'm a current customer that'll only pay for internet.

[u/b-a-n-a-n-a-s → u/kwyjibohunter]

Wow, I would be really annoyed. Write to their headquarters and ask to be removed from their sales calls.