Blockbuster increasing fees by $1

[GreenMotion]

I just got an email from Blockbuster stating they are going to increase their subscription fee by $1 a month.

It really isn't that much and they will still be cheaper than netflix; but geez, I am getting so pissed off by everyone forcing price increases down my throat. Especially since I don't use it that much anyway. When Netflix increased their prices, I dropped them and went to Netflix. If anything, just to signal them I wasn't ok with it. So now I am really considering dropping Blockbuster and going back to netflix; but from reading this forum I see they (netflix) are still having long-wait queue's and on top of that, that 30 day waiting period for some titles.

ARGH. what to do .. what to do!!!! Maybe I'll drop online rentals all together.

[connect42]

Originally Posted by GreenMotion

... I am getting so pissed off by everyone forcing price increases down my throat.

Dumbest comment ever. Not just this time, but every time it is made. Nobody, I repeat - NOBODY is forcing you to pay them.

[Chloenator]

Originally Posted by GreenMotion

When Netflix increased their prices, I dropped them and went to Netflix.

So which one was better? Netflix or Netflix?

[vegeta88]

Originally Posted by GreenMotion

I just got an email from Blockbuster stating they are going to increase their subscription fee by $1 a month.

It really isn't that much and they will still be cheaper than netflix; but geez, I am getting so pissed off by everyone forcing price increases down my throat. Especially since I don't use it that much anyway. When Netflix increased their prices, I dropped them and went to Netflix. If anything, just to signal them I wasn't ok with it. So now I am really considering dropping Blockbuster and going back to netflix; but from reading this forum I see they (netflix) are still having long-wait queue's and on top of that, that 30 day waiting period for some titles.

ARGH. what to do .. what to do!!!! Maybe I'll drop online rentals all together.

Like you said,$1 more isn't too bad especially if it still beats the competition but I see where you are coming from. If you feel like the new price isn't worth it, drop it. Otherwise I don't see why you should be too upset. Like another poster stated, no one is forcing the new price on you.

I didn't know Netflix was having long wait issues. I have some titles that have been in my queue for months on a waiting status.

Originally Posted by GoPens78

So which one was better? Netflix or Netflix?

[Minimejer05]

I never got the 1 dollar increase. However, they did manage to send all 3 of my movies to someplace other than my home... and now I got emails saying "Thank you for returning your movies, we will send your next movies in Q". I called the guy and explained how I never got the movies and that its been over a week... He said sorry and that they will resend them... he then offers me a free movie rental coupon. I go to open it only to release its for DVD and VHS(lol wow?) only. No mention of Blu Ray... so I didnt even bother trying to use it.

[progers13]

So...in essence...Blockbuster wants to lose more money this year...

[connect42]

Originally Posted by progers13

So...in essence...Blockbuster wants to lose more money this year...

That makes no sense. Most people will not even notice the $1.

[progers13]

Originally Posted by connect42

That makes no sense. Most people will not even notice the $1.

It makes perfect sense. It's called economics.

The idea behind a rate hike is to make more money than you give up. In this case, Blockbuster is raising the fee by $1 (x% of their revenue). Blockbuster knows that some people will not pay the extra dollar. They are gambling that the number of people who do pay that dollar will offset those who do not. As an example: If Blockbuster intends to increase their revenue, say, $10 million in extra sales, that sounds great until you take into account, say 15 million fewer rentals. So what happens? Blockbuster raises the rate and sends themselves further into a tailspin.

The way to increase revenue in this market is to reduce rates to encourage people to rent more. More unit sales = more money. Less unit sales = less money.

Read up on a principle known as Elasticity of Demand.

[BStecke]

It's a lot less than a 25% increase. Like 9% at most.

I have Blockbuster but didn't receive any notice of an increase. I actually just got an email the other day saying that I have unlimited in store exchanges for the next three months instead of my usual three.

[progers13]

Originally Posted by BStecke

It's a lot less than 25% in most cases.

Granted. It was meant as an example to illustrate how elasticity works, but you are right. I didn't have the actual numbers in front of me. I'll modify it.

[connect42]

Originally Posted by progers13

So...in essence...Blockbuster wants to lose more money this year...

Originally Posted by progers13

It makes perfect sense. It's called economics.

The idea behind a rate hike is to make more money than you give up. In this case, Blockbuster is raising the fee by $1 (x% of their revenue). Blockbuster knows that some people will not pay the extra dollar. They are gambling that the number of people who do pay that dollar will offset those who do not. As an example: If Blockbuster intends to increase their revenue, say, $10 million in extra sales, that sounds great until you take into account, say 15 million fewer rentals. So what happens? Blockbuster raises the rate and sends themselves further into a tailspin.

The way to increase revenue in this market is to reduce rates to encourage people to rent more. More unit sales = more money. Less unit sales = less money.

Read up on a principle known as Elasticity of Demand.

I do not need to read up on anything. You are assuming that people will rent less. That is not a fact. That is an assumption.

[progers13]

Originally Posted by connect42

I do not need to read up on anything. You are assuming that people will rent less. That is not a fact. That is an assumption.

People will rent less. But I'm not going to debate it with you since you clearly don't have an understanding of the economic principle I'm talking about, nor do you have the desire to open your mind beyond what you think you know.

Be happy paying your extra $1 a month, if that is what you choose to do. Many others will choose to do otherwise whether you believe that or not.

[Kocheese99]

I just got the e-mail about the increase as well. I would be ok with this if they could actually send the movies in any kind of order. Every shipment seems to be insanely out of whack. I'll give them another month or two and if it still sucks i'll drop them and just go back to buying instead.

[connect42]

Originally Posted by progers13

People will rent less. But I'm not going to debate it with you since you clearly don't have an understanding of the economic principle I'm talking about, nor do you have the desire to open your mind beyond what you think you know.

Be happy paying your extra $1 a month, if that is what you choose to do. Many others will choose to do otherwise whether you believe that or not.

Well I am so very sorry that I can't seem to rise to your level of understanding. Instead of working on economics maybe you should try not being so very condescending.
I have spoken to 5 other Blockbuster Online customers tonight that agree with me - the $1 will not change their stance with Blockbuster. Even with the $1 extra the deal is still better than other options. 100% of the Blockbuster Online customers that I know (including myself) are not concerned and are not cancelling. All of your infinite wisdom on the subject is just a big guessing game.

[progers13]

Originally Posted by connect42

Well I am so very sorry that I can't seem to rise to your level of understanding. Instead of working on economics maybe you should try not being so very condescending.
I have spoken to 5 other Blockbuster Online customers tonight that agree with me - the $1 will not change their stance with Blockbuster. Even with the $1 extra the deal is still better than other options. 100% of the Blockbuster Online customers that I know (including myself) are not concerned and are not cancelling. All of your infinite wisdom on the subject is just a big guessing game.

Actually, as a matter of being condescending, you stated that my first post makes no sense. I simply provided documentation to back up my argument. You, however, still have not.

But I digress... Back to your point about 5 people willing to pay the rate hike, that may be. I never said all people will not pay it. Only that more won't than what Blockbuster is gambling will (hence, Elasticity of Demand). But you won't even acknowledge that several people in this very thread are saying that they will not pay it.

But what do I know? I'm just a guy typing on a computer, and I guess my business background doesn't count for anything. You're probably right; everyone will prance along like happy sheep and pay it because they love the service they get from Blockbuster. I'll tell you what - let's both of us save this thread, and come back this time next year and see if Blockbuster's still shutting down stores and losing money.

[connect42]

Originally Posted by progers13

I simply provided documentation to back up my argument. You, however, still have not.

... come back this time next year and see if Blockbuster's still shutting down stores and losing money.

You provided an opinion. I have provided an opinion. I am just not ass enough to pretend that my opinion is fact.

Of course they will be shutting down stores. They said in a press release that they would be shutting down stores. They should shut down stores. Some cities have 6 to 8 stores. That is wasteful business and they are repairing that problem. The mid-level town I live in has 5. It probably should have 3.

"But you won't even acknowledge that several people in this very thread are saying that they will not pay it." --- hmmm, yea. Let's take a look:

The OP asks what to do and makes no firm decision. Another post makes fun of the OP. One agrees with me that #1 uptick is not that bad and complains about something else. Two complain about queue issues and one takes a wait and see approach. One talks about getting an email offering unlimited exchanges through March. The only other posts are mine and yours. I am not cancelling and I am fairly certain you are not a Blockbuster customer. Ok, now that I have "acknowledged" the "several people in this very thread" I am very sure of what I was sort of sure of in the first place.

[Osufan]

Originally Posted by connect42

Well I am so very sorry that I can't seem to rise to your level of understanding. Instead of working on economics maybe you should try not being so very condescending.
I have spoken to 5 other Blockbuster Online customers tonight that agree with me - the $1 will not change their stance with Blockbuster. Even with the $1 extra the deal is still better than other options. 100% of the Blockbuster Online customers that I know (including myself) are not concerned and are not cancelling. All of your infinite wisdom on the subject is just a big guessing game.

I didnt know there were 5 other Blockbuster Online customers....

[connect42]

Originally Posted by Osufan

I didnt know there were 5 other Blockbuster Online customers....

Nice.

[My_Two_Cents]

I haven't seen this...yet. It won't change my renting habits, as it still beats driving to a video store and paying $4-5/movie. My problem with BB online is that unless you have 'available' movies at the top of your queue, they don't seem capabale of sending you anything, even though there may be 'available' movies in the >10 slots. What kind of system is that?

[progers13]

Originally Posted by connect42

You provided an opinion. I have provided an opinion. I am just not ass enough to pretend that my opinion is fact.

Of course they will be shutting down stores. They said in a press release that they would be shutting down stores. They should shut down stores. Some cities have 6 to 8 stores. That is wasteful business and they are repairing that problem. The mid-level town I live in has 5. It probably should have 3.

"But you won't even acknowledge that several people in this very thread are saying that they will not pay it." --- hmmm, yea. Let's take a look:

The OP asks what to do and makes no firm decision. Another post makes fun of the OP. One agrees with me that #1 uptick is not that bad and complains about something else. Two complain about queue issues and one takes a wait and see approach. One talks about getting an email offering unlimited exchanges through March. The only other posts are mine and yours. I am not cancelling and I am fairly certain you are not a Blockbuster customer. Ok, now that I have "acknowledged" the "several people in this very thread" I am very sure of what I was sort of sure of in the first place.

The point I was driving at (and thank you for illustrating it for me, by the way) is that you made a blanket statement that "100% of the Blockbuster Online customers that I know (including myself) are not concerned and are not cancelling", whereas 2 other posters in this thread have expressed displeasure about the rate increase. Whether they cancel outright or in 2 months is irrelevant. A cancellation adds support to my argument, even if it is in 5 or 10 months. I never said all people wouldn't rent (even though you continue to say all people will), only that the revenue drop Blockbuster will experience will not be offset by the potential gain through this rate hike. That's it. That's all there is to it. Maybe I'm wrong, maybe I'm not. But I hardly think that 5 people (including yourself) constitutes a large enough sample size to say with any statistical confidence level that an entire population of people will do anything.