Netflix was a godsend when it came out. Blockbuster was tail-spinning and other movie rental stores had already crashed and burned. Online movie rentals were still pretty new, and never had anything current besides. Forget On Demand, it cost more to see a movie On Demand than it would have a month prior to see it in the theater. With the appearance of Netflix, suddenly we had movies at our fingertips, point and click, wait two days, keep it as long as you want, no late fees...aahhh.

     Well that was then and this is now. Now you can get a fairly new film for $1 out of a Redbox, Blockbuster finally got its ass in gear and joined the online market, and Netflix has been attempting to innovate to stay on top. First it was webstreaming videos, and they even added it for free. A perk of doing business with them. Good move. Last year, after signing a deal to get on Xbox 360, customers could opt out of by-mail DVDs and just go webstream (Instant Play) for a smaller rate. Also a good move. Now, Netflix has sent out an email telling all By-mail users that they will no longer get webstream as a perk, but will have to pay a (fairly high) premium to keep it. For 1-disc by-mail you currently pay $9.99 a month and get streaming free. With the changes, customers that want to keep streaming and their 1-disc by-mail will have to pay $15.95 a month, and the worst part about it is that there are no additional services. You're just paying more for what you're already getting. Bad move.

     Many people don't use streaming, but have it anyway, and this is the only reason that I can fathom why Netflix would decide to make this move now. Streaming isn't easy if you don't have an Xbox or laptop or some internet-ready device hooked up to your TV. Essentially, there was a service they were providing a lot of people that weren't even using it. On the other hand, many were; myself for instance. I dropped the dvd-by-mail and went all-streaming-all-the-time (so I didn't get the nasty email). However, I also understand that streaming isn't available enough, or popular enough yet for a premium price. Hulu doesn't even charge yet, and all they have is ad revenue. In addition, Netflix recently initiated a rate hike for their customers, and are reporting significant profits, 28% first quarter, according to their blog.

     According to Atlantic Monthly, Netflix may stand to lose a lot of money, even most of it. Quoting the LA Times, about 80% of of Netflix users are by-mail customers who get streaming for free. If half of those subscribers cancel their now premium-charged webstreaming, they'll see an average of 20% savings on their bill. If that many individuals reduced their bill by 20%, Netflix would be losing up to 95% of their profit margin (Assuming they don't have revenue outside of subscription fees). Once investors see a drop like that (you can guess where this is going) they stop dropping out like flies. The stock sells, share prices plummet, the company loses capital, the sun expands, the earth burns, life ends as we know it....all because Netflix dicked with their customers. My feeling is, if you have a good thing going, keep it going. They are making huge profits, they're the wet-dream of every web investor, a house-hold name, and the best internet movie rental company out there. Raising rates just 'cuz? Stupid move.