Netflix will be upping the cost of its streaming service to $11/mo. in November, but what is the content provider doing to earn the price increase?
Just how much is too much to pay for the world’s most popular streaming service?
If you missed the news, Netflix is raising the price of its standard $10-per-month plan to $11 for existing subscribers come November (new subscribers must pay the higher fee immediately). A Netflix price increase used to be premium fodder for the internet’s outrage machine—the company’s 2011 attempt to turn its DVD-by-mail and streaming services into separate businesses sent its stock tanking and led nearly a million customers to cancel their subscriptions. But another price hike on the streaming side from $8 to $9 in 2014 produced less digital vitriol, partially because existing subscribers were warned two years in advance of the increase. The jump from $9 to $10 in 2015 was accompanied by a one-year grace period. This time around, though, customers received only about a month of notice.
Netflix, long thought of as a customer-centric business, is taking on some of the powerful swagger of the Hollywood and cable industries it aims to disrupt. Content shuffles onto and off of the service with only a few weeks’ warning. Prices keep creeping higher. And the original programming that is quickly becoming the platform’s main draw varies wildly in quality. It’s time to start asking the tough questions: Is Netflix really still worth it at $11 per month?
The price increase is all about perspective. Is an extra $12-per-year going to break the bank? Probably not. Given how many recurring subscriptions I discover are still draining my bank account despite months of disuse, $12 isn’t enough to get anyone to pull the plug. Instead, I’d ask, “Will Netflix always be worth this new price?”
If you’re someone who appreciates the original content coming out of Netflix, then this (and future) price increases may not bother you. Consider the volume of premium series the service has produced over the last four years: GLOW, Orange is the New Black, House of Cards, Daredevil, Jessica Jones, Stranger Things, The OA, Bloodline, Ozark, Mindhunter, Narcos, Master of None, Fuller House, The Ranch, Love, BoJack Horseman — as a content provider, it’s hard to argue with the value of Netflix.
Not everyone is on-board with Netflix’s original content, however. The platform’s earliest programming — the programming that Netflix’s earliest subscribers first bought into — was clearly not original. Instead, Netflix offered a massive library of prestige television series that had premiered over the last ten or twenty years, like Breaking Bad, Lost, The Office, The Walking Dead, Parks and Recreation, Futurama, Family Guy, How I Met Your Mother, Fringe, Friday Night Lights, Mad Men, 30 Rock, and Last Man Standing, among many others.
If the last few months have taught us anything about the direction that the streaming service is headed, it’s that Netflix appears to be betting on its original content and NOT on retaining series like 30 Rock, Fringe, How I Met Your Mother, Friday Night Lights, Futurama, Last Man Standing, Family Guy, all of which have been removed (or are very close to disappearing) recently.
It’s in the nature of licensing agreements for shows to expire and turn over to new services, as fans of 30 Rock (and Hulu stakeholders) just learned. In the long run, as there are more and more services from more and more providers, Netflix’s cache of outside shows is bound to diminish. So now the race is on to compensate for that in original series and films people are willing to pay the same price, if not more, for.
With Netflix, Hulu, and Amazon fighting over the rights to premium content, the internet is re-inventing the problem that cable already solved. And anecdotally, people tend to rely on Netflix as this catch-all crutch that collects everything they need in one place. Their success — and people’s willingness to pay — hinges on whether they can live up to that. The first question I get about ANY show I recommend is: “It’s on Netflix, right?”
So is $11/mo. a fair price for Netflix? Yes. And no. And maybe.
Those who can’t get enough of Netflix’s original content — House of Cards, Mindhunter, GLOW, Stranger Things, etc. — should have no gripe with the price increase, or additional price increases in the future. Just think about what we pay for premium cable packages like HBO. By comparison, Netflix puts out far more quality content than HBO for a similar price.
On the other hand, the price may not be as agreeable for Netflix users who bought-in thanks to its once massive library of outside shows. I don’t know if tacking another $1 onto your monthly statement is going to be a make-or-break moment, but the service’s recent pattern of removing notable television series is certainly worth keeping an eye on. Personally, I was devastated to find that some of my favorites were on the chopping block. And as much as I love their original series, the news of Friday Night Lights’ departure made me consider storming and setting fire to Netflix’s proverbial castle ala Gaston and the angry villagers. If the pattern continues, those of you who find yourselves longing for the comfort of your favorite outside television series of the past may need to look elsewhere.
Todd VanDerWerff of Vox wrote a great piece about how Hulu is aiming to replace Netflix as Chief Aggregator, basically. Netflix’s long-term goal is that they’ll have so much original content they won’t need outside help; Hulu’s is certainly not to give up on originals, but augment them with the comfort TV we used to assume was part of the Netflix experience.
Talking years down the line, it’s no secret that Netflix’s sole focus will be producing original content. For now, it’s safe to say that the service still has the market cornered on outside television content and can justify their membership fees. But if you’re like me — constantly disappointed by the number of outside shows disappearing from their virtual shelves — it’s worth noting that Hulu will soon become the spiritual successor to the Netflix model we once knew and loved. Choose carefully.