Netflix Still Boning Best Customers

We were a bit surprised by the renewed ruckus concerning Netflix throttling the turn around speed of heavy users, considering it’s been a well-worn topic on Netflix blogs for at least a couple of years. But thanks to a new article on CNN.com, the issue is back to upset a whole new set of customers.

Here’s where we stand: we like Netflix, on the whole. It does work as advertised. We don’t like the throttling, although we can understand the need to give new customers preferential treatment. (We don’t agree with that philosophy, but we understand it as a business model.)

So here’s a much better question: how would you fix it? Is the answer as simple as making the turn-around time the same for every customer? (Thanks, Tim!)

Netflix sends frequent renters to the back of line [CNN]

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  1. Papercutninja says:

    I think the reason they might be throttling down the speed of heavy users is cuz those people have figured out the rhythm of how to receive, copy and return the DVDs in the most efficient manner. Not that i have a problem with that.

  2. Paul D says:

    Wait, wait…

    You mean…people are copying Netflix movies?

    The heck you say.

    Isn’t that illegal?

    *grin*

  3. CMPalmer says:

    I’m an ideal Netflix customer. The reason I went to Netflix was because I am really bad at getting around to watching movies and returning them, so the late fees were killing me. I have a “three at a time” Netflix account and I probably average 9 movies a month.

  4. I understand that Netflix has to throttle in order to be profitable. But they try to give every impression that they send the next movie as soon as they get the last one back, so to do otherwise is pretty sleazy.

    Maybe there should be “NetFlix Karma”. When it’s excellent (e.g. you borrow for a week on average), you’ll have the speediest delivery and shortest waits on high-demand films. When it’s low, you’ll be told that you’re being throttled.

    There needs to be some sort of transparency in this process for it to be defensible.

  5. Buckhorn says:

    The problem I see is that the heavy users could end up costing the rest of us more money. The guy in the CNN article was getting 18 to 22 DVDs a month before Netflix throttled his usage…there’s no way they could break even on that considering they’re now paying $.78 in shipping (maybe less if they’re getting some sort of bulk rate). And if they don’t make money then they go out of business and we’re all stuck with Blockbuster which would really suck.

    What I don’t like about the policy is that it’s not made clear up front. If they clearly stated that as part of the membership there was a cap on the number of movies you could get in a month or that after a certain number you’ll start moving to a low priority queue then that would be fine…in fact, I believe they have at least one level that explicitly caps your per month shipments. But that sort of thing needs to be clear and open and not buried in the TOS or added later in one of those “Change in Terms” e-mails that we all get…and delete without reading.

  6. nweaver says:

    They aren’t copying them. They are “Making backup copies”

  7. kickslop says:

    Here’s the analogy: You sign up for broadband service with “unlimited” bandwidth. You consistently are only ever able to get 10mbps. You raise the issue with the company and get told that’s basically all you’re going to get.

    You have several choices after the assumed 1st step of vocalizing your plight (which I am ALL FOR, regardless of peoples’ distaste for Manuel above).

    a) Cancel your membership/account.
    b) Continually bitch and continue to pressure for resolution of some sort.

    I’m a big proponent of ‘b’.

    Netflix promised something they cannot deliver on and are going about the resolution in a poor way.

    My fix ideas:

    1. Announce a future date for a change in policy wording to reflect limits. Remove ‘unlimited’ from everything. It was only a matter of time before that nasty word came back and bit them, and they were foolish to use it so lightly. If people don’t like the policy changes, they are welcome to cancel their membership at any time before the upcoming change date. It is a month-to-month contract.

    2. Fix the supply problem with DVDs and fulfill all requests without throttling.

    If I was paying for the highest account with Netflix and was being denied movies in a timely fashion upon their release (in favor of new members), I would be royally pissed off.

  8. Clampants says:

    I think it is clear that using the term “unlimited” is the problem. Part of me thinks a solution would be somewhere in the “Membership Structure” at Netflix. According to their membership page, they have plans that go up to an 8-at-a-time (unlimited) $48/month plan…but why on earth would anyone pay that when you could get an allegedly unlimited plan of 3-at-a-time rentals for $18/month.

    Though, i’d imagine dropping the term “unlimited” from their marketing (even if they are lying about it in practice) would certainly hurt memberships.

  9. Roxstar says:

    What killed me is that the guy from Netflix said that they have very high customer sat ratings. Are you kidding me?! I’ve been looking for a way to get through to them for a long time. They actually do not take complaints. The only methods of contact are for technical issues.

    And I want to reiterate the key part of the throttling that is most offensive. I started with a 2x plan and rented about 8 movies a month. My first few movies came amazingly fast and I got all the good movies too. Then I switched to a 3x plan. I paid more so that should cover their extra costs right? I was soon renting 11 movies a month. But almost immediately, the only movies I could get were foreign language films from 1960. Everything in my queue was “Long Wait”, “Very Long Wait” and “Very very long wait”. In fact, “Unleashed” sat in my queue for 3 months before I finally gave up and got it on PPV. After reading the article, I see that other people were getting “the high demand movies” much quicker. They also started holding onto my movies longer before sending new ones.

    If they were short on product, my high turn-around time would help them. And their various pricing plans should help them cover costs of high usage. If they want to take their time getting my next movie in the mail, I can live with that. But to decide that I can’t see any of the movies that I want to see b/c I rented to many (in other words, gave them back their movies promptly) is unacceptable.

    To do all this in the face of constant public criticism (in the form of lawsuits, CNN coverage, and numerous unhappy blogs) and claim high customer sat simply b/c they don’t give anybody a way to complain to them directly makes me want to slap them until my arms are tired.

  10. Kevin Meyers says:

    Since I’ve started renting from Netflix more frequently (about 15-20 movies/month), I’ve also noticed that all of my new releases become “Long Wait” or “Very Long Wait.” I’ve had “Cinderella Man” at the top of my queue for over a month now, in fact.

    I am considering switching to Blockbuster’s Netflix-esque service, mainly because they offer coupons for one free in-store movie rental/week. Does anyone use the Blockbuster service? Particularly anyone who switched over from Netflix and can give a pros/cons?

  11. Kevin Meyers says:

    Another note: Lifehacker had a post a few weeks ago about how to “Turn Netflix ‘Very Long Wait’ to ‘Shipping Today’”.

  12. RowdyRoddyPiper says:

    Kevin, this doesn’t address your question directly, but it may give some insight. I have the Blockbuster Movie Pass which allows me to take out 2 movies at a time from the physical location. The pros are, my wife can go in at 10am on Tuesday and get pretty much any new release. The cons are, actually having to go to blockbuster and the fact that it is restricted to the Blockbuster where you have actually signed up for it.

    That means I was forking over $5.00/movie while on vaction this winter to get The Longest Yard or some other crap to watch with my nephews. Also, with “the end of late fees” it has been harder to get movies that I want if I don’t snap them up right when they come out. For some reason people tend to hang on to “Broken Flowers” longer than “Roll Bounce”. Also the guaranteed in stock thing doesn’t apply to Pass memebers, though if you’re smart about it you can still scam them out of the rain check and give it to someone else.

    Overall, it’s worth it, I don’t know about their Netflix style service, though I may switch to it. If you’re into really obscure/hard to get films, then it may not be the best option. Your choices are limited to what they carry in store.

  13. etinterrapax says:

    I don’t care much about waiting for new releases, since I watch very few (more TV than movies, and I can certainly wait a while longer for Magnum P.I. reruns–how pathetic would I have to be, really, to whine about that?). But what bothers me about the throttling is that wait times for any movie appear to be longer if you’re tagged as a heavy renter, and for a media/film theory grad student, their “average” number of rentals per month is laughable. If that movie is available when I have a slot available, I want it when they offered to have it to me, and not a nanosecond later. I keep the service because to buy all of the obscure films I need to see, plus the other movies and shows I just want to see, is economically unsustainable for me. I don’t copy anything; this much viewing is part of my de facto job. I pay for a service, and they owe me the level of service that they guarantee and that I pay for. That they have set themselves up in a poor business model shouldn’t immediately become the customer’s problem. Their lowered rates were nice, but not absolutely necessary. I was happy with them at the higher monthly rate. Blockbuster’s coupons are useless to me because when I rented from a B&M, the late fees killed me. I’m staying with Netflix, but only as long as they’re the best I can do for what I need. I’m definitely no longer the kind of customer/ambassador for them that I once was.

  14. Roxstar says:

    That lifehacker method didn’t work for me. I never removed all my movies, but I decided to not add any more once I ran out. Every time I looked at my queue, I got a note at the bottom that said something to the effect that if I want a movie, I need to add more movies to my queue. I spent a month with one movie in my queue, “Unleashed”, it still never came. Again, they made it seem like they were just out of it and that I had a fair shot at getting it.

    After reading this article, what I suspect happened for this other guy is nothing more than a coincidence.

    BTW, in December I downgraded to a 1x plan and decided to sit on a movie for a while and build up some new releases in my queue. I held the same movie for about 5 weeks. I just recently sent it back and now, all 11 movies in my active queue are Ready right now.

    The point is that if high volume usage costs them more, they should just charge more for it. Oh wait, they do. Then, it should be first come first serve. If they have to raise the rates to cover costs, that is just part of doing business. One might cynically say so is operating with poor ethics but this is too much for my taste.

    What I’d love to do is get 10000 people to join me in a Screw Netflix effort. We would all put thousands of crappy unpopular films in our queues. Then, we would up our plans to the 8x temporarily. Every day, we would take our 8 movies and put them right back in the mailbox and send them right back. If they’re paying $0.78 per shipment and we could get them to go through 100 cds per month per customer… on a large enough scale, we could stick it to the man.

  15. L_Emmerdeur says:

    Problem: You want to use the Lifehacker trick to always get movies shipped immediately, but you have a massive queue on Netflix, and you don’t want to delete it.

    Solution: Using Amazon’s Wish List, add all of your Netflix queue items (this is a one-off task). Then, delete your Netflix queue. When you want to queue a movie, add it to your Amazon Wish List, and only keep enough items in your Netflix queue (3) to make sure you always get “Now Shipping”. Add items from your Wish List to your Netflix queue as you send items back, and remove them from the Wish List.

    Added bonus: you can check to see if any of the DVDs in your Virtual Queue are on sale at Amazon, an maybe buy them instead. (Now Jeff Bezos owes me money)

    Your welcome. [sic]

  16. drsmith says:

    Well, I certainly don’t have the problems that others have mentioned. Let me tell you what works for me.

    Setup a queue of about 18-20 movies. Don’t add more movies until your down to about 3 left in the queue, and when you do add movies, make sure some of them aren’t the latest releases. I’d say about 40% of my queue is movies from the ’70s, 80′s, and ’90′s. Heck – one or two of them isn’t even distributed anymore. Those older movies aren’t there just to pad the queue, either. I just sometimes like to rewatch some of the older stuff for comparison to todays movies. Don’t turn around on a movie any faster than 1 week – or about 12 to 14 movies per month on the 3 at a time plan.

    The end result is that all of my movies are ready to ship now. All the time. I’m not a new customer, either – I’ve been with NetFlix for over a year.

    I tend to think heavy renting of the latest movies causes distribution issues – so putting it more into balance avoids being throttled.

  17. Juancho says:

    I have a lame but simple suggestion, but it involves a bit of patience and for you to leave the house.: Try the library.

    I work as a librarian and write and do other creative things on the side. I occasionally watch new releases, TV on DVD, and whatnot. But I watch a lot of classics, foreign films, and stuff that’s on VHS and may never make it to DVD. Most libraries today, including mine, have catalog access on the Internet. You can place holds and manage your status all online, even getting emails when your stuff is ready for pickup.

    You usually have a longer wait for newer releases, but aside from late fees/fines (which are usually lower), this is a goldmine, and not only for movies.

  18. Jen says:

    Couldn’t agree more with Juancho. Cities like NYC and DC all have online Netflix-like systems for books and movies, and they usually get new releases the day they’re released (more so with popular new releases). They do it the simple, straightforward way, too- first come, first serve in the queue. I like to look ahead online and find out release dates and then reserve the movies before they come out, and I usually get them the first week of release. They don’t deliver to your door, but they will deliver to the nearest library of your choice.