"Netflix has another year or two on most of these contracts, and then the game completely changes," says Michael Pachter, analyst at Wedbush Securities.
Pachter predicts Netflix's streaming content licensing costs will rise from $180 million in 2010 to a whopping $1.98 billion in 2012.
Michael Pachter is an analyst for a private equity firm. Google for some choice opinion and meta-analysis.
And for all we know, Wedbush is short on NFLX.
People have been parroting this guys opinion as if it's fact. It's worthwhile analysis, perhaps even correct, but they've got money in this game on one side or the other and without knowing which, this opinion is useless.
Yes it did. It increased 4x for a large portion of their users (including me). My 12 bucks a month for 1 blu-ray and unlimited streaming is now 8 + 10. So if the cost of one blu-ray a month is 9.99, I was getting streaming for 2 bucks. Now it costs me 8.
You could look at it the other way and say that I was getting 1 blu-ray a month for 4 bucks and now it's costing me 10. But since Netflix historically has been about the DVDs, with the streaming as an addon (historically = before 2010) I think my first price comparison makes more sense.
No, but it could be netflix helping the acceleration of the DVD's demise. Also, I'm sure the additional monies made from those who still rent DVDs will be used to help support the ever increasing cost of streaming content.
Movies have already been disappearing from Netflix's streaming service, so I'm sure licensing issues are at least part of the reason for raising the prices.
