Netflix pricing

It looks kind of screwy; 3 movies at a time is $16.99 a month but 8 movies at a time is $47.99 a month.  After three movies, the average cost of a rental (see the link for the numbers) is either flat or rising.  Why go for the 8 movies deal instead of setting up separate accounts and queues, thereby saving money?  Why is Netflix encouraging everyone to do the 3 movies a month version of the plan?  Why are there no quantity discounts past the 3 movies a month margin?  (And, by the way, aren’t there still lower prices for newbies, at least for a while?)

I suspect this is one of those pricing models that traps a small number of overenthusiastic patrons into paying more, keep a few others away from overgorging on old Jackie Chan films and then quitting prematurely, and de facto gives most customers a pretty flat pricing structure.  Transparency is sacrificed but does anyone really care?

The pointer is from Angus Hedrick.


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