Netflix has taken another step toward being a streaming-only company, with an option that removes physical formats from the equation. And at $7.99, the same price as the newly-reduced Hulu Plus, it’s a bit of a bargain.
Netflix Streaming Only
As we’ve known was going to happen for almost a month now, Netflix has today officially introduced a streaming-only subscription plan. Costing $7.99, it is available to all customers in the U.S. from today.
For $7.99-a-month, Netflix users can enjoy unlimited streaming of all the content available through ‘Watch Instantly’. With the prices of all the DVD-inclusive plans going up (from $1 to $8), it’s likely to be a very popular choice.
From Physical To Digital Formats
Netflix is clearly trying to persuade people that streaming is the future direction of the company. By increasing the prices of the DVD plans at the same time as offering a new, cheaper-than-anything-else streaming-only plan, Netflix is gently pushing people to adopt this new option.
New users are likely to go straight for the streaming-only option, which could affect revenue in the short-term. But by reducing the number of DVDs it has to send out via mail, profits should go up.
The more people stream content, the more money Netflix will spend acquiring it. And the more content that’s available to stream, the more likely people are to subscribe to the service. It’s a strategy that could snowball from this moment and put Netflix in the driving seat of the video streaming express.
Conclusions
Make no mistake about it, this is just the beginning of Netflix’ lurch to streaming. Streaming is the company’s future; Netflix knows it, and so do we. It’s really just a question of how long the process is going to take. My guess is a few years at least, because not everyone is ready to ditch physical formats quite yet.
