Point of View: Netflix’s appeal diminishes as profit trumps all

A month into my college career, a professor began class by discussing Netflix. I knew about Netflix, of course, but I had never seriously considered becoming a member.

The more I thought about joining, the more it made sense. I could certainly afford $9 a month (which got me as many DVDs as I could watch and mail back, and unlimited streaming ability), I had plenty of free time and there were hundreds of movies I wanted to see. Plus, Netflix’s convenience and massive selection blew Blockbuster out of the water.

I pulled the trigger and signed up. More than three years later, I’m glad I did. As I prepare to graduate, Netflix has been one of the constants of my Baylor experience. It doesn’t matter if I’ve lived in Penland, North Village or an apartment– I’ve fetched those iconic red envelopes out of my mailbox every week.

I’ve rented 215 movies. Do the math and that comes to about $1.80 per movie. Not a bad deal. That doesn’t include all the value I’ve gotten out of Netflix’s instant streaming service. I’ve blitzed through entire seasons of “Lost,” “Dexter,” “The Office,” “Friday Night Lights” and more on my laptop, without being forced to watch annoying ads like on Hulu.

When I was a sophomore one of my assignments for speech class was to convince my classmates to invest in a company. I chose Netflix, not because I’m an expert on stocks, but because I wanted to research a company I actually liked and believed in. At the time, the Netflix stock was selling for about $46.

I hope my classmates were listening carefully. Recently heralded by Fortune Magazine as “the stock of the year,” Netflix’s stock has rocketed up more than 200 percent since last January.

Shares now sell for about $182. For all the company’s success, Netflix CEO Reed Hastings was named Businessperson of the Year by Fortune.

But this isn’t a love letter to Hastings and his company. As much as I like Netflix, recent moves by the company have me concerned.

A year ago Netflix began signing deals with major film studios, like Warner Bros. Entertainment, agreeing to delay the studios’ DVD and Blu-ray releases for 28 days to give the studios more time to sell before customers can rent the discs. In exchange, Netflix got access to more titles from Warner’s catalog for customers to view online.

This setback has proven to be incredibly annoying. Before the change, getting brand new DVDs in the mail on the day they were released was a thrill. Now, many of the most popular titles, like “The Social Network,” are withheld from customers for the first month of their release, which is exactly when most customers want to watch them.

What’s more, prices have been raised. My plan jumped a dollar to $10 a month, before tax. That’s not enough to make me cancel my subscription – yet – but it doesn’t bode well for the future.

Most recently, Netflix announced it was removing customers’ ability to manage their DVD queues on their digital devices, like iPhones. The logic behind the move? Netflix is trying to encourage customers to stream more content via its “watch instantly” feature – and rent fewer physical DVDs through the mail. That’s because Netflix knows that instant streaming is the future of movie and television viewing. In 20 years, everyone will be using the Internet to stream content directly to their televisions.

The catch is that Netflix’s library of films and TV shows available for instant streaming pales in comparison to its DVD library.

To be fair, the company has improved its instant streaming selection over the years, but not nearly enough to begin shifting its core business from physical DVDs.

I’m not alone in my frustration. Angry customers have stormed blogs and Netflix’s Facebook page to voice their displeasure.

Netflix may have enriched my college years and provided endless hours of entertainment and distraction, but if the company forgets what made it so popular in the first place – listening to customers – then it’s going to lose at least one subscriber: me.

James Byers is a senior business journalism major from Indianapolis. He is the news editor for the Lariat.