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Netflix Exec Defends 28 Day Deal
Has no choice but to kiss up to Hollywood

A few weeks back we noted how Netflix had made a dubious deal with Warner Brothers, agreeing to delay the release of new physical DVDs for 28 days -- in order to get access to a greater volume of titles for broadband streaming. The deal stinks for DVD users who like new releases, and was driven by a misguided Hollywood executive fear that giving customers what they want (cheap, easy, instantaneous broadband access to huge film titles) will result in fewer DVD sales.

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Netflix of course is stuck between a rock and a hard place as they try to convince Hollywood that broadband video isn't the devil. The company can either make a deal like this that annoys customers -- but boosts their streaming title catalog, or refuse to make this deal, probably pay more cash, and offer fewer streaming titles. Hacking Netflix has an interesting interview with Netflix Chief Content Officer, Ted Sarandos, who explains why the company did the deal:
quote:
The most practical reason is that the savings derived from this deal enable us to be in stock completely on day 29. Remember that we're a subscription service and the way that you manage the economics of a subscription service is to manage the demand of any disc, depending on the economics of the disc. In the case of the most expensive disc, which in this case is a Warner Bros. disc, purchased through a 3rd party, those discs were out of stock for far longer than 29 days for most Netflix subscribers.

So what were able to is create a deal with them that gave them a little open running room in terms of creating a sell-through window ahead of rental, for us, and hopefully that they'll find enough value in that it'll extend to other retailers and other studios will take note and it'll extend across other studios as well. The net savings derived from technically creating a better customer experience have been redeployed in additional streaming content for all customers.


Sarandos pours it on a little thick, continually insisting that there's no losers in the deal, and that delaying new physical release rentals somehow creates a "better customer experience." Of course Sarandos and CEO Reed Hastings need to stay on Hollywood's good side, so it's not like they can speak the truth: that Hollywood executives continue to make stupid decisions, and believe that making it harder for consumers to access their content will somehow salvage a dying physical media pricing model.

Fortunately, many Netflix customers won't care -- given they'll get access to Warner Brothers titles like the Matrix Trilogy, Caddyshack and Dirty Harry. But that still doesn't make the deal any better, given Hollywood's simply forcing customers out of their homes and to a brick and mortar rental store (or Redbox) to get content they gladly would have paid for in their living room.
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Morac
Cat god
join:2001-08-30
Riverside, NJ

Morac

Member

Not as big a deal as people make it

Lately I've been finding that I can't get a new release for a few weeks anyway because the title has a "very long wait". Lots of times I don't get around to get a "new release" until a few weeks after it comes out any way either because there's other stuff in my queue or because of the "long wait".

So the "28 days later" deal won't really affect me. I'm more annoyed by Fox's crippled DVD/BR "rental disks" where all the features except the movie are removed than WB's delayed releases.

NPGMBR
join:2001-03-28
Arlington, VA

NPGMBR

Member

Re: Not as big a deal as people make it

I agree completely. The way I see it is if I didn't run to the theaters to see it I damd sure ain't gonna jump over people's backs to see it.

I'm not the type to buy a movie that I have not seen. I just won't take the chance on buying someting that I might not like enough to watch again and agian. So unless I saw it at a theatre and loved it enough to see it over and over i.e. Star Trek there is on way in hell im gonnna run out to buy it. Trust me I'll wait calmly till its available in my que.

mod_wastrel
anonome
join:2008-03-28

mod_wastrel to Morac

Member

to Morac
Totally. 4 weeks... BFD. It'll still be "new" to the viewer(s) when he/she sees it.

Subaru
1-3-2-4
Premium Member
join:2001-05-31
Greenwich, CT

Subaru to Morac

Premium Member

to Morac
said by Morac:

So the "28 days later" deal won't really affect me. I'm more annoyed by Fox's crippled DVD/BR "rental disks" where all the features except the movie are removed than WB's delayed releases.
wow they are doing this for new releases on netflix now?

Morac
Cat god
join:2001-08-30
Riverside, NJ

Morac

Member

Re: Not as big a deal as people make it

said by Subaru:

wow they are doing this for new releases on netflix now?
Fox is doing this for all releases. Originally Fox said they would only do it for DVDs, but the last two BRs I got were also crippled.

Subaru
1-3-2-4
Premium Member
join:2001-05-31
Greenwich, CT

Subaru

Premium Member

Re: Not as big a deal as people make it

hmm intresting.. I really can't remember the last time I brought a DVD from a retail store.. while I've been off and on with netflix I find I don't need to buy any dvd's since I hardly ever watch them more then once unless it was very good.
88615298 (banned)
join:2004-07-28
West Tenness

88615298 (banned) to Morac

Member

to Morac
said by Morac:

said by Subaru:

wow they are doing this for new releases on netflix now?
Fox is doing this for all releases. Originally Fox said they would only do it for DVDs, but the last two BRs I got were also crippled.
No biggie. I never watch that extra crap anyways. I wish they'd sell a DVD/blu-ray without that crap at a discount. If you want the extra features then buy the DVD/blu-ray. That's kind of the point and really I don't blame them. No law saying they have to add ANYTHING extra.

Subaru
1-3-2-4
Premium Member
join:2001-05-31
Greenwich, CT

Subaru

Premium Member

Re: Not as big a deal as people make it

said by 88615298:
said by Morac:
said by Subaru:

wow they are doing this for new releases on netflix now?
Fox is doing this for all releases. Originally Fox said they would only do it for DVDs, but the last two BRs I got were also crippled.
No biggie. I never watch that extra crap anyways. I wish they'd sell a DVD/blu-ray without that crap at a discount. If you want the extra features then buy the DVD/blu-ray. That's kind of the point and really I don't blame them. No law saying they have to add ANYTHING extra.
gotta agree.. only SOME movies I will check it out if I really like it or I seen it before but wanted to see the extras.

fifty nine
join:2002-09-25
Sussex, NJ

1 recommendation

fifty nine to Morac

Member

to Morac
said by Morac:

said by Subaru:

wow they are doing this for new releases on netflix now?
Fox is doing this for all releases. Originally Fox said they would only do it for DVDs, but the last two BRs I got were also crippled.
Minor nitpick, it's BD (Blu-ray Disc) not BR.

spewak
R.I.P Dadkins
Premium Member
join:2001-08-07
Elk Grove, CA
·Consolidated Com..

spewak to Morac

Premium Member

to Morac
said by Morac:

Lately I've been finding that I can't get a new release for a few weeks anyway because the title has a "very long wait". Lots of times I don't get around to get a "new release" until a few weeks after it comes out any way either because there's other stuff in my queue or because of the "long wait".

So the "28 days later" deal won't really affect me. I'm more annoyed by Fox's crippled DVD/BR "rental disks" where all the features except the movie are removed than WB's delayed releases.
That was exactly what I was going to post.
It is a moot point, this whole excercise of blaming Reed of sucking up to the Studio. If you turnover alot of movies rapidly, they throttle your Q anyhow. New titles are always long waits anyhow. So there is nothing new here to see.
But, if by delaying divids for twenty or so days increases the Instant watch library, then that is a big plus.
AstroBoy
join:2008-08-08
Parkville, MD

AstroBoy

Member

Re: Not as big a deal as people make it

I am on the 3 at a time deal and most of the time I get 6 per week. I don't see any throttling. Maybe for the long wait stuff. But if I keep my queue full, they ship without delay. Been doing this for 2+ years now.

I also have a Roku, so my need for DVDs is going down.

I don't like the 28 day wait. But I can use Redbox if I feel the need or a torrent site.

odreian615
join:2006-01-18
Chicago, IL

odreian615

Member

Re: Not as big a deal as people make it

They are trying this with Redbox also
»www.businessinsider.com/ ··· x-2009-8
Looks like they really want people to torrent movies

Phil
Rojo Sol
Premium Member
join:2001-06-11
Downers Grove, IL

Phil to Morac

Premium Member

to Morac
Which Sarandos addresses above.
ElJay
join:2004-03-17
Portland, ME

ElJay to Morac

Member

to Morac
I can't believe it is cost effective for Fox to do a run of crippled discs. I mean the idea of a second master plus a second manufacturing run just for rentals seems insane. And to double that for BD is even crazier.

mod_wastrel
anonome
join:2008-03-28

mod_wastrel

Member

Re: Not as big a deal as people make it

And yet: »www.google.com/search?so ··· e+Search
(Yeah, "crazy"... like a Fox [exec]! )

Subaru
1-3-2-4
Premium Member
join:2001-05-31
Greenwich, CT

Subaru to ElJay

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to ElJay
said by ElJay:

I can't believe it is cost effective for Fox to do a run of crippled discs. I mean the idea of a second master plus a second manufacturing run just for rentals seems insane. And to double that for BD is even crazier.
I was thinking the same..
33358088 (banned)
join:2008-09-23

2 edits

33358088 (banned)

Member

um lets see

A) old tv had a vcr i could tape it
B) this dont allow that unless you get snaeky and crack drm
C) it uses too much bandwidth
D) i dont need HD cause i aint paying 3000$ for the setup hardware wise
E) the cost /month is out of wack for what distribution costs
( i am paying for distribution why isnt hollywood pay me the 80% of the ten bucks )

(E) is the big thing they shift distribution cost to the net user then have us pay the same? thats like a 10000% price increase

boy thats gonna be a large thing to solve and HD has been aorund now how long ?
I remember h264 encoding in 2005 and 2004 so its already very old and this bluray crap too expensive

ill stick to newsgroups and torrents until you twits fix the 5 above issues and i don't mean fixing it with ACTA either
beaups
join:2003-08-11
Hilliard, OH

beaups

Member

Re: um lets see

$3000 for what??

jackknife
join:2001-02-24
Phoenix, AZ

2 recommendations

jackknife

Member

Re: um lets see

I think I figured it out

$100 BD Player + $300 HDTV + $600 couch + $2000 for an old mobile home = $3000

Frank
Premium Member
join:2000-11-03
somewhere

1 edit

Frank to 33358088

Premium Member

to 33358088
said by 33358088:

D) i dont need HD cause i aint paying 3000$ for the setup hardware wise
I dont know what type of setup you're trying to buy but my 46" sharp 1080p 120hz hdtv only wound up costing me $700 and the 37" 720p tv that I bought 3 years earlier cost me $750.

Good deals can be had if you know where to look. Even if you pay full retail you can still get a decent hdtv for anywhere between $500 and $700 which is what a good old fashioned large tube based tv cost years ago. Nowadays I dont know of many stores that sell anything but HDTV's.
88615298 (banned)
join:2004-07-28
West Tenness

2 recommendations

88615298 (banned) to 33358088

Member

to 33358088
said by 33358088:

A) old tv had a vcr i could tape it
B) this dont allow that unless you get snaeky and crack drm
C) it uses too much bandwidth
D) i dont need HD cause i aint paying 3000$ for the setup hardware wise
E) the cost /month is out of wack for what distribution costs
( i am paying for distribution why isnt hollywood pay me the 80% of the ten bucks )

(E) is the big thing they shift distribution cost to the net user then have us pay the same? thats like a 10000% price increase

boy thats gonna be a large thing to solve and HD has been aorund now how long ?
I remember h264 encoding in 2005 and 2004 so its already very old and this bluray crap too expensive

ill stick to newsgroups and torrents until you twits fix the 5 above issues and i don't mean fixing it with ACTA either
perhaps if you spoke better english we could make sense of your post. But I'll try.

A and B)You could tape what with a VCR exactly? Not sure what VHS has to do with this. If you meant in the old days you could make copies of your rented VHS tapes sure and it was illegal. I'm not sure why you think you should be allowed to get a free copy of a movie.

C) Too much bandwidth? I guess if you're on dial-up.

D) What does HD have to do with anything? And no a HDTV don't cost $3000. You can get a decent 42" HDTV for 1/4 that. You can get a 32"( equivalent to a 27" old style tube TV ) for about $400.

E) That's just ignorance talk. You're not paying for distribution. You're not distibuting anything. Also $10 for 17,000 movies and TV shows? Funny how people pay $15 a month for HBO or Showtime.

Then you spout of a bunch of nonsensical crap. Blu-ray isn't expensive and prices are coming down everyday. And once again what does that have to do with Netflix streaming?

And in the end you admit you'll just continue to steal until they "fix" the problem by which I'm guesing you mean give you everything for free.
openbox9
Premium Member
join:2004-01-26
71144

openbox9 to 33358088

Premium Member

to 33358088
What are you "taping"? Your rental?

Uses too much bandwidth? I was under the impression that Netflix only uses a couple of megabits.

You don't have to consume HD. SD still works just fine.

It's a rental service.

Doctor Four
My other vehicle is a TARDIS
Premium Member
join:2000-09-05
Dallas, TX

1 edit

Doctor Four to 33358088

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to 33358088
Foot, meet gun.

That seems to be the standard procedure lately for Hollywood.

As for B, the answer I have is AnyDVD HD. I've never had to use it because I have never bought nor rented any Blu-Ray titles, and most of what I've bought with SD DVDs is protected with only CSS, which DVDFab can handle.

Hi Def doesn't necessarily run into the $3000 range, either. a 42" LCD runs around $600-700, with plasma being about $100-300 more. Blu-Ray players are mostly under $200. So a complete HDTV and Blu-Ray player will run around $1000-1200 or so. These prices are based on what I saw at Amazon.com.

In my case, I have a Blu-Ray burner and a 24" 1920x1200 LCD monitor, so I am HD ready on the PC. The screen size may be a bit small compared to a TV, but there's not much room on the desktop for a bigger monitor.
ctggzg
Premium Member
join:2005-02-11
USA

ctggzg to 33358088

Premium Member

to 33358088
Stop making excuses and trying to convince people that your "habits" are anyone's fault but your own.
Youngjm
join:2002-04-01
Ada, MI

Youngjm

Member

Not interested in Streaming

Until the ISP's stopping talking about pay per use and remove these artificial caps, I for one am not going to get hooked on streaming large quantities of movies then get hit in the pocket book once it becomes part of my life. DVD/BR's work just fine for me right now.

DaveDude
No Fear
join:1999-09-01
New Jersey

DaveDude

Member

Whats the difference ?

I dont understand what the difference is when its on HBO, showtime etc, or on Netflix. Its all the same one is just one demand.

icp1
Premium Member
join:2000-10-13
Saint Louis, MO

icp1

Premium Member

Done with sub services anyway

I loved netflix for quite a while, but now, I've given up on any subscription service.

My library now has new release DVDs (!!!) or I just go to red box for an immediate fix.

MTBikerChris
Premium Member
join:2001-08-28
Erie, CO

MTBikerChris

Premium Member

Re: Done with sub services anyway

said by icp1:

I loved netflix for quite a while, but now, I've given up on any subscription service.

My library now has new release DVDs (!!!) or I just go to red box for an immediate fix.
Aww That sux. I only stop ( put on hold ) my subscription in the summer to camp and be outdoors since i live in Colorado. I have been a member since it 1'st came out when i worked for best buy and they gave us a discount way back when. I can't wait for the wii to have it streaming .
WhatNow
Premium Member
join:2009-05-06
Charlotte, NC

WhatNow to icp1

Premium Member

to icp1
The studios are mad at Redbox for hurting their DVD sells and want to make them start delaying Redbox rentals.

cableties
Premium Member
join:2005-01-27

cableties

Premium Member

Still...I like Netflix

and don't mind being a NOT ME FIRST when it comes to watching flix.

"If you don't control the content, you don't have much control"

tmh
@qwest.net

tmh

Anon

Meh!

I can wait.

BCSman
@covad.net

BCSman

Anon

Instant Gratification

I'm with a lot of the posts here. Sure, I'd love to have access to the latest and greatest released movies on NetFlix but I don't "HAVE" to have them. I can wait as I don't need to impress anyone with the fact that I saw this or that movie or have a burning obsession for watching the latest in movies. Netflix does a great job in my opinion of providing a pretty decent selection of movies to rent for a damned cheap cost.
Blue-Ray is still a bit more expensive as far as purchase costs over SD. I see prices range from about 15.00 to 30.00 and over which is higher than Standard DVD but BD pricing will come down , its just a matter of time. I can wait..
I personally think that unless you buy a LCD/LED/Plasma screen that is 46" or larger BD is really not needed to provide a great picture. I've only got a 32" Sony and SD looks fine and the difference in BD quality is negligible.

What I do find disturbing is the statement that if you turn movies over quickly with NetFlix that your queue is throttled.
Guess I need to understand what is meant by turning over movies quickly. I rent 3 per week sometimes I can get in 5 a week but that's rare. Most if not all of the latest releases on Netflix are ALWAYS "A LONG WAIT" for me. Never have I seen a single title that was immediately available if it was a BOX OFFICE BIGGIE.

aljandro
@rr.com

aljandro

Anon

crap.

i used to have so much respect for this company and for once, actually felt like they listened to their customers.

just another company bowing to the a**holes

mig
MVM
join:2000-10-26
Anytown, USA

mig

MVM

Big Deal

Given the choice between more streaming content or access to new releases, I'll take more streaming content.

Waiting four weeks isn't that long to me.
Automate
join:2001-06-26
Atlanta, GA

Automate

Member

Re: Big Deal

Same here

digdug
Premium Member
join:2008-02-01
Mount Vernon, WA

digdug

Premium Member

My Vote is....

I can wait, usually do anyway. More selection for broadband streaming is the way to go!

Bill Neilson
Premium Member
join:2009-07-08
Alexandria, VA

Bill Neilson

Premium Member

I still don't think of it as that big a deal

I can wait 4 weeks

FFH5
Premium Member
join:2002-03-03
Tavistock NJ

FFH5

Premium Member

Re: I still don't think of it as that big a deal

said by Bill Neilson:

I can wait 4 weeks
I wait until it comes on HBO/Showtime/Starz etc. I subscribe to them and I can wait until the movie is available there.

funchords
Hello
MVM
join:2001-03-11
Yarmouth Port, MA

funchords

MVM

Re: I still don't think of it as that big a deal

I buy mine used on Amazon. Usually less than a single theater ticket, even after shipping!

kfsutops
Premium Member
join:2002-08-19
Lutz, FL

kfsutops

Premium Member

Netflix New Releases are hidden anyway

Though I think he is selling himself to the devil, it doesn't really matter.

The one thing I hate about Netflix is the way they handle New Releases now. I NEVER NEVER EVER see new releases when I hit the new release button. They are hidden now so people won't put them in their backlog.

Netflix is all about manipulating the customer demand. And this will never improve their shitty online streaming. You make a deal with the devil you usually get burned. Good Luck with that Netflix.

morbo
Complete Your Transaction
join:2002-01-22
00000

morbo

Member

Re: Netflix New Releases are hidden anyway

said by kfsutops:

And this will never improve their shitty online streaming.
works fine for me with an occasional buffering pause.

kfsutops
Premium Member
join:2002-08-19
Lutz, FL

kfsutops

Premium Member

Re: Netflix New Releases are hidden anyway

I guess I should clarify..Shitty selections. The service by itself works great.
elray
join:2000-12-16
Santa Monica, CA

elray

Member

No Defense Necessary

Netflix' primary selling point is flat-rate, no-late-penalty access to a rich library of titles. For recent releases, you're at the mercy of the queue/throttling and the US Mail. Meanwhile, the streaming inventory is a joke. While I prefer physical media and don't mind the wait, clearly, a few years from now, DVD-by-mail will be a premium niche service while streaming will be standard - though who owns that market is yet to be determined.

Netflix is very wise to grow their online rights as fast as possible, before iTunes, CableCo and TelcoTV show them up. If that means a delay interval for new titles, so be it.
hnd4me1
join:2009-02-14
Colton, NY

hnd4me1

Member

Completely idiotic!

So we wait 28 days after its release so then we can have a VERY LONG WAIT list! wonderful if this happens i'm so ditching netflix, a redbox is just a few mins. away! all i watch for movies now are the new releases and a online movie is very seldom. As it is, ive only gotten 3 new release dvd's that came out last month to beginning of this month. so much for the 2 at a time plan.

••••••
decifal7
join:2007-03-10
Bon Aqua, TN

decifal7

Member

screwed again

Once again, the people that are denied access to broadband are screwed over.. Obviously we use the dvd service to get movies delievered via snail mail because we can't download pirated or even legal copies of movies.. Now this happens.. Thanks alot Nutflix.. Maybe blockbusters service will still get new release's on time..

Tell me that theres not a need for a regulated deployment of broadband, then take your words and go skydiving without the parachute...

VegasMan
Living the Vegas life.
Premium Member
join:2002-11-17
Las Vegas, NV
·CenturyLink

VegasMan

Premium Member

Anti Competitive

Why wouldn't this cause Netflix to file an Anti-Competitive suit against the studios?

Are they forcing Blockbuster to wait 28 days? No.
Are they forcing all the mom and pop video stores to wait 28 days? No
Are they forcing Red Box to wait 28 days? No.

I see this as something that Netflix could file suit against.

jima
@bellsouth.net

jima

Anon

Re: Anti Competitive

According to the interview, Netflix was the one to initiate the idea of delaying movies. Hard to file suit against yourself!
coreyography
Premium Member
join:2010-01-15
Houston, TX

1 edit

coreyography

Premium Member

Meh...

Most of what comes out of Hollywood these days is not worth buying, nor is it worth wasting one mmHg of blood pressure fretting because you can't rent it for 28 days.

I have all the tools I need to rip/copy DVDs and BDs, and I have enough Internet connection to download them (streaming or torrents), but 99% of the craptent that is currently produced is really not worth even my time. Redbox and used DVD carts in the grocery store are sufficient for me.

EGeezer
Premium Member
join:2002-08-04
Midwest

EGeezer

Premium Member

the phrase that tells ...

"customer experience" is the salesspeak phrase used to obfuscate the screw job they're about to foist on you.

Anytime a vendor spews out "better/enhanced customer experience.", grab your wallet and watch for price increases or service level reductions.

Granite
@ributorcentral.com

Granite

Anon

Good deal

I think it's a wise move. Expanding their streaming content is great, and I can wait a bit for the new releases. If I really needed to see something that bad I can hit a RedBox.
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