Someone is missing the point, and this time it's not just Netflix.
Consumers continue to pay for cable despite bi-annual rate hikes after all, and $8 for streaming or DVD rentals continues to present good value in the face of ever-soaring cable TV rates.
I'm not sure exactly how many are "content" with bi-annual rate hikes, but for the last several years I've made damn certain that I continually get put on promotional rates with my TV and/or Internet providers. If they refuse, I switch. End result, my entertainment costs have remained flat over the last several years.
What Netflix fails to realize is that by raising prices, they are quickly falling out of "complementary service" range when it comes to cable TV. Myself and many I know originally subscribed to Netflix in order to rent DVDs as a complementary service to broadcast/cable TV. When they added streaming, their selection wasn't great, but rapidly got better. In the end, it was STILL only a complementary service though, as everything they had was available on cable or elsewhere anyway. But for the price, Netflix still offered a value advantage for what it provided. But then they went and all but "doubled" the price or split up the service.
Let's face it, the streaming portion, especially with it losing a good deal of content recently, is a mediocre attraction at par price. The DVD component is still competitive with the industry, especially given Netflix's ability to provide recent content in a timely manner. But honestly, with companies like Redbox breathing down their throats and becoming ubiquitous - I mean really, how many people actually plan out what movies they want to see in advance for months at a time?
Sorry, this move was purely a shareholder move. I have a feeling it will be far more than just a "blip on the radar" in the long run.