Netflix has pricing power as streaming overtakes DVD rentals

Netflix revamped its subscription rates and introduced a $7.99 a month streaming-only plan. In addition, the company raised its base DVD rental service to $9.99 a month, up $1.

Netflix revamped its subscription rates and introduced a $7.99 a month streaming-only plan. In addition, the company raised its base DVD rental services to $9.99 a month, up $1.

The move highlights a few key points (statement, blog):

  • Netflix has pricing power to raise DVD rates.
  • Netflix is "primarily a streaming video company."
  • The company is betting that most customers will go streaming only and that will save some serious costs on all sides of the equation.

Here's the breakdown of pricing:

The pricing starts in January for existing members. Netflix has done a masterful job of managing the physical DVD rental to streaming transition.