Blockbuster Changes Pricing

Is Blockbuster allowed to change their prices and plans? Of course. Everyone is month-to-month and can cancel at any time. That doesn't mean we have to be happy with it. When Netflix came on the scene and started hurting Blockbuster, Blockbuster panicked and opened its own online store. They gave you a choice of two free in-store rentals per month or one free in-store rental per week. They promised investors they would get 200,000 customers by, I believe, December of last year, and were failing miserably. Then they offered Total Access, giving people a greater reason to jump the Netflix ship because they could turn their DVD mailers into the store and get a free movie for each mailer instead of just the two per month or four per week. The only downside to this is that combined with the new late fee policy, it has sometimes been harder to find movies.

Now Blockbuster is changing things up again. Apparently Total Access was too good of a thing. Now, instead of my $17.99 per month getting me 3 DVDs at a time plus unlimited in-store rentals, it only gets me 5 per month. To get the unlimited in-store rentals, I need to cough up another $7 per month, a 38.9% increase in price for the same benefits! Although it's possible that I deleted their e-mail as spam, I have not seen anything about this and only found out about it because a store employee told me.

Well, you might say, you're basically back to what you had, the one in-store rental per week. True. I was pretty happy with the one per week. The point is, the reason they hit their 200,000 subscribers is because of Total Access. Now they are saying that if you want to keep the reason you signed up, cough up more money. While not technically bait-and-switch, it feels similar.

Okay, well, there are other plans. What about getting less DVDs at a time and still getting unlimited through the store? Well, I could drop to 2 DVDs at a time, but to get unlimited in-store rentals it would still cost me $21.99 per month.

Blockbuster attempts to answer this by saying, "We are now offering a full range of subscription options so that our customers can more easily find a plan that meets their specific needs, whether that means a basic online-only service without any in-store exchange privileges or a premium plan that includes unlimited in-store exchanges. Our new line-up of plans allow subscribers to get the right number of movies for their needs. Current subscribers are welcome to change their plan at any time by going to My Account."

Now that I'm done my rant, I've looked and found that apparently Blockbuster lost $35.3 million in the second quarter and that this is the reason they are limiting the Total Access program.

It will be interesting to see if Blockbuster has shot themselves in the foot. They've angered / are going to anger quite a lot of people (even if they don't normally rent more than five per month). Also, for $16.99, I can get the same three movies at a time from Netflix with 17 hours of streamed video. Assuming I rented only 3 hour movies from Blockbuster, Netflix would still be a dollar less for 2 more hours of video. The only downside to the streaming video at Netflix is that you need Windows XP or Vista.