Netflix Turns Focus Back to Disc

[Stoudman]

Originally Posted by Anthony P

it has absolutely everything to do with money. When talking about companies every decision taken (right or wrong) has to do with money. Have you seen to many bad movies where the only goal of the corporation/CEO is to destroy the world. Even what you say has to do with money. Let me give a simple example, I have a garage sell, I have a Trinket (not important what it is for the example) two people show up that want to buy it, one of them offers me 20$ the other 30$ which is a better deal for me? obviously the guy offering 30$. The same here, the trinket is us, the person with the garage sale is the studio, the two guys bidding are the distribution channels (Netflix, PPV, local rental shop.....) if they make less when you watch it through X then Y then it is bad for them money wise. And we (consumers) are like the trinket because except for possibly some slim exceptions (i.e. rented a movie liked it and bought it) as individuals we won't use many distribution channels.

You're missing the point. I believe Starz was hampering the quality of their content on NIW for just this reason, which is an underhanded tactic at best. Of course, my only evidence of this is the quality of the content itself, but why else would any company knowingly produce content in the poorest possible quality when they obviously have much better quality prints available and being shown on their station?

Also, how is renting a movie, liking it and buying it a slim exception? You seem to enjoy claiming that certain habits are either rampant or not rampant enough based on little or no evidence.

It may very well have been about money when it all comes down to it, but the impetus behind the decision for both parties was the fact that Netflix wouldn't budge and create a "premium content" system for Starz. Why should they? From their standpoint, they are paying more for Starz (at that point, ten times the amount they had previously paid them) than most if not all of the other content on their IW system. To make matters worse, the content is in the worst possible quality pretty much at all times. Why would they make their customers pay more for worse quality? It doesn't make sense. If Netflix would have agreed to these terms, I can only imagine the hell that would have broken loose when people discovered the "premium Starz content" and found upon viewing it that the quality was worse than most of the other content that WAS NOT "PREMIUM." They would have had some pretty pissed off customers on their hands, even moreso than they have now.

In this situation, the only intelligent solution is to drop the matter, let the current contract fizzle out and move on. I don't see how anyone could refute this matter, it's just about the simplest business decision anyone would ever have to make.

so you are telling me if I start a poll on Netflix.com and ask " As a Netflix streaming user do you buy, PPV or rent from other places as many films as you used to before you started streaming with Netflix" most people will say no? and that they have cut back on other distribution channels.

No, I'm telling you that your example isn't valid. If you're going to claim some kind of altruism based in statistics, you better actually have the statistics to back it up. One person out of millions is not a good basis for study. It's like when An Inconvenient Truth used 150 years of data as a basis for their argument when they would have needed at least 10-50,000 years for anyone with a scientific understanding of the analysis to take them seriously. Only in this case, your example is much worse.

That being said, I think if you did start a poll you might find that Streamers buy and watch DVDs/Blus and downloadable/online content from other sources a lot more than you seem to assume.

I guess it is not hard in, like you point out, 1000 titles to pick 8 titles you can say you don't care for to make an invalid point of how the content does not matter.

I wasn't making a point about how content over all does not matter, I was making a point about how the Starz content over all does not matter. True, these were only a few examples of the films you can find on Starz Play, but combine that with the fact that even the decent films through the service are in the worst possible quality and somehow I doubt that anyone with any taste and sense of visual quality will really care when Starz is gone.

lol, nothing for now and a long delay eventually is a better deal then content and no delay

Well, that's a fallacy. It's not "nothing for now." Just because Starz Play will be gone does not mean that there is nothing else on NIW. Starz play represents 8% of the total content on NIW. Are you really trying to tell me that 92% of the original 100% is...nothing? Seriously? Is that your argument? Should I just laugh in your face now? Or should we schedule it for another, more appropriate time?

Also, I'd hardly call a few months a "long delay."

?

Did something about this confuse you? You were comparing the fall of HD-DVD to the supposed fall of NIW. These are two entirely different things. They cannot be compared. HD-DVD is one format supported by one entity. VOD/Streaming is a format supported by several different entities. HD-DVD may have been supported by several different companies and studios, but so is NIW alone. Combine with it the streaming from sites like Youtube, Hulu, Vudu, ect. and it's easy to see that there's more going on here than there ever was with HD-DVD. The two simply cannot be compared.

you do like making ridiculous posts.

Oh, have you read my work? I'm glad you like it.

1) I hope you are smart enough to have insurance, if so then the money does come pretty fast (as opposed to theft where the insurance company
waits a month to make sure the goods are not found)

What if I was living paycheck to paycheck? What if I literally didn't have the money for insurance? It happens all the time, sadly. Does this mean to you that these people don't deserve entertainment? Does this mean to you that they can't spend $10 on a DVD player and enjoy their favorite movies whenever they want to? If so, your view of the the world is rather small and pathetic.

2) when are you living, 2006? You can easily find new feature rich BD players for under 80$ is that really such a big expense? And why would you need an expensive HDTV, a BD player can be hooked up to any TV so buy the same one you would buy for the DVD player. If, let's be generous, the 50$ difference is that big of an issue then maybe you should be thinking on saving some $$$ on the unnecessary fixed monthly expenses
I am sure you could save that each month being less wasteful. (now nothing wrong with being wasteful if you have the $$$ but you are making a big point about a difference that is more realistically 30$ and at worst 50$)

No, I live in 2011, where for some people $80 is quite a bit of money. That doesn't mean they can't be film fans, that doesn't mean they don't have the right to enjoy the movies and television shows they want to. You seem to be under some strange assumption that a greater amount of the population is WEALTHY than is POOR. Unfortunately, the truth is very much THE CONTRARY of this assumption.

Also, are you suggesting someone should buy a BD player even if they don't have an HD source to hook it up to? Really? Why would you want to watch blu-rays in SD? Isn't that kind of counter productive? You definitely won't see a difference, so what the hell is the point? Why, if you were low on funds and only had an SDTV, would you pay $80 for a BD player instead of $10 on a DVD player? Financially, it makes no sense. In terms of quality, it makes no sense. Your argument makes no sense.

don't know what era you are talking about, maybe the 50's, 60's, early 70's but in the mid 70's the VCR came to market and then PVRs/DVRs. You are not forced to watch anything at a specific time it is just that with TV you can watch it when you want after it is broadcast. With Netflix you cannot, like with BD or DVD you have to wait until it is released.

They didn't really start releasing VHS titles for sale until the mid to late 80's. VHS/VCR's was created for the RENTAL MARKET. Also, you seem to skip quite a few technologies between VHS and PVRs/DVRs. With TV you are forced to watch it when the show is set to release on air. If you don't catch it then, you might get lucky and find it On Demand or played in repeats shortly after. If not, you're screwed, just like everyone who doesn't buy into cable/satellite or misses the broadcast.

you do know real TV can be free? Also I don't have an issue with Marathons or watching series. Strilo said " Netflix Streaming is not a replacement for Blu Ray for me. it's a replacement for TV". So we agree, the same way I can watch marathons of the TV series I have bought on BD someone who does not care about quality can watch marathons on Netflix, but it is not a replacement for TV because Netflix does not have the equivalent of broadcasts where the next day after it plays on TV, someone can be discusssing the episode with friends or on a forum.

Yes, I'm very aware that TV can be free. However, increasingly among said "free TV," if you don't catch it the first time it is aired, you're either going to have to wait a week or more to catch it on demand or pay out the nose to catch it sooner. How this is "free" is beyond me. It keeps you tethered to their schedule, to the way that they choose to do things. If you want it differently, you're going to have to wait. Does this mean you can't discuss it with your friends when you finally get the chance to see it? No. It just means you don't get to do so right away. This is hardly a tough price to pay when one can't be bothered to be tethered to their television at all times.

no issue with that, I buy many TV shows as well, I also PVR almost everything I watch. The issue though is that if you watch a show on Netflix it is not comparative to watching that show on TV.

How do you figure? Because you don't get to see it at the same time as every other slave to the system does? I simply can't see this as a negative aspect of NIW. I'd also like to mention that this one aspect that you might consider a "positive" does not transfer very well across the broad spectrum of the medium of cable/satellite/broadcast television.

In particular, I'd like to bring up the point that films and television shows that were previously filmed or shot in different aspect ratios are now more frequently than ever being framed to fit a 16x9 television screen. Look at Cartoon Network: They have taken all of their 4:3 content and either stretched it or cut the bottom and top off so that it would fit a 16x9 screen. They have, in effect, destroyed the content they show to their viewers. Another great example is the recent marathons that Spike TV has had of the Star Wars films. All of them were cut to a 16x9 frame, regardless of being filmed in a much wider and more grandoise aspect ratio.

Why would you pay more for this? Oh, and don't think Cable stations are the only ones that do this. I once saw ABC do it to a POTC film as well.

Again, what exactly are the advantages of television when they have yet to catch up with the rest of the world when it comes to quality? Receiving your entertainment quicker than everywhere else? Is that really it? Is that really the only valid argument you have against the use of NIW and other services like it? Come on, now.

[Steedeel]

Some of us prefer to watch pictures without the background falling apart or black scenes looking like an atari console. We like the reliability rather than relying on several variants just to get a moving picture constantly. Ping, latency, time of day, bandwidth used, connwction speed, throttling, interuptions.......do you see my point?

[animefan77]

So... I didn't read the entire thread, but has anyone noticed any changes that makes you believe that Netflix did change its focus back to disc? (Other than failing to renew the Starz streaming) I'm wondering because all the anime DVD that have "unavailable" status are still unavailable. And there are still tons of niche titles that are not even shown on the site. Or am I just thinking wrong? Does Netflix focusing on disc means more advertising for disc rental and having less titles for streaming? and not about adding more niche titles for rent?

[Stoudman]

Originally Posted by Steedeel

Some of us prefer to watch pictures without the background falling apart or black scenes looking like an atari console. We like the reliability rather than relying on several variants just to get a moving picture constantly. Ping, latency, time of day, bandwidth used, connwction speed, throttling, interuptions.......do you see my point?

Sure, I see your point.

I don't see how choosing a better ISP wouldn't solve most of these problems, but I do understand the desire to see a consistently good quality. Obviously this is best experienced with physical formats like blu-ray. I spend more money on blu-rays than I do on Netflix. However, I still use Netflix because it provides plenty of content and convenience to keep me happy. Examples:

Quantum Leap is one of my favorite shows of all time. They don't have every episode on NIW, but they do have quite a few. This probably isn't going to be ported to blu any time soon, if ever. The DVD sets alone are still pretty expensive. When I can afford them, I will buy them. I can't afford them, so I'm glad I have NIW if I want to watch the show.

Similarly, I love the show ReBoot, which was recently added to NIW. The recent DVD releases were terribly screwed up. The Netflix versions are not the same as the DVD releases. This, too, will probably never see a blu-ray release and possibly never even a decent DVD release.

I discovered such films as:

Primer
The Parking Lot Movie
Sin Nombre
Entre Nos
Children of Invention
Fish Tank
The Proposition
Angel-A
ect.

I own half of them on DVD/Blu-ray now.

The quality, while pretty damn good for me, still isn't something I'd want to rely on when I could own the film or television show on a physical media format. If it's something I like and I can afford the price of the physical format, I'll buy it. If not, I'll wait and hopefully it'll be something on Netflix, so I won't have to wait without any opportunity to watch it.

Do you see my point?

[pro-bassoonist]

Originally Posted by rickah88

Pro-B, don't get me wrong...I, very much, look forward to your posts on industry trends and find them very insightful. I just think, IMO, you may have been a little harsh towards Netflix as(again IMO) they are still the King of Hill for time being.
Yes they are branching out, as any growing business would do. Your posts almost imply that Netflix is a sinking ship, which I have no reason to believe...right now! Now after more streaming deals are made, with big companies...well it may be a different story.
Unless you're on the Netflix BoD, I'll continue to stick to my beliefs that Netflix: has been & continues to be an industry force. Not a failed middle man.
My only head-scratcher were the WB, Fox, & Uni deals Netflix signed to get cheaper product at the cost of a 28day wait period. I'd be interested to know when those deals expire(I believe signed last year)...as in this digital age, it's all about: What can you do for me, RIGHT NOW!
Since BB didn't sign any such deals, they have been able to use this as a great advertising slogan against Netflix. So what might have been a nice "long term" deal(as you metioned), may not be a good "short term" deal.
As for the OP...I have seen a few additions to Neflix's BD library over the last couple of months, but not nearly enough to justify(in my experience with them) a "focus on discs".
Again, I think 2012 will see some big changes for Netflix...but that's just specualtion on my part. I do know, that as of now, Netflix more than meets my blu-ray needs at a great price. That's why I'll continue to stand by them, but will keep an eye out "down the road" too.

1. I don't see how I am being harsh towards Netflix. Their strange behavior during recent months has prompted many to question their moves, which were a direct result of what I described to you earlier. Look at how the market reacted in recent weeks while observing Netflix's behavior, and how Netflix's stock performed - quite a bit of harshness there.

2. No, my post does not imply that Netflix is a sinking ship. As I already mentioned twice earlier, I am convinced that there is a place on the market for the type of service they offer. At this point, however, I believe that the Netflix ship is guided by people who are taking very serious risks and entering some very dangerous waters - hence the market reactions. The other thing to keep in mind is that Netflix is not the only ship out there.

3. "Focus on discs" - the focus was always there. What I described earlier to you is that Netflix tried to manipulate the (streaming) market and become it, essentially hoping that just like Blockbuster years ago they could dictate conditions for the studios. This did not happen and won't happen for two reasons: a) the streaming market does not have the unity the physical market does b) unlike the physical market Blockbuster was in control with, on the streaming market the content owners do not necessarily need a middle man like Blockbuster to sell their content, and they will dictate how their content is sold (anyone thinking that they will tolerate a streaming Blockbuster like the one we had 10-15 years ago does not understand the market).

You have a wonderful week

Pro-B

[Stoudman]

Originally Posted by pro-bassoonist

1. I don't see how I am being harsh towards Netflix. Their strange behavior during recent months has prompted many to question their moves, which were a direct result of what I described to you earlier. Look at how the market reacted in recent weeks while observing Netflix's behavior, and how Netflix's stock performed - quite a bit of harshness there.

2. No, my post does not imply that Netflix is a sinking ship. As I already mentioned twice earlier, I am convinced that there is a place on the market for the type of service they offer. At this point, however, I believe that the Netflix ship is guided by people who are taking very serious risks and entering some very dangerous waters - hence the market reactions. The other thing to keep in mind is that Netflix is not the only ship out there.

3. "Focus on discs" - the focus was always there. What I described earlier to you is that Netflix tried to manipulate the (streaming) market and become it, essentially hoping that just like Blockbuster years ago they could dictate conditions for the studios. This did not happen and won't happen for two reasons: a) the streaming market does not have the unity the physical market does b) unlike the physical market Blockbuster was in control with, on the streaming market the content owners do not necessarily need a middle man like Blockbuster to sell their content, and they will dictate how their content is sold (anyone thinking that they will tolerate a streaming Blockbuster like the one we had 10-15 years ago does not understand the market).

You have a wonderful week

Pro-B

You have a point and I think it's something a lot of people don't understand today. Video Rental stores controlled the market in the 80's and 90's, VHS tapes at the time (or at least at first) being rather unaffordable (to the tune of over $100 per copy, hence the high price for not returning your rental on time). Times have changed quite a bit and the studios have a lot more say in how things are done on the physical market and of course the streaming market.

However, I would say the streaming service is the middle man in this case, unlike the brick and mortar stores of old. I also think that there's no reason for a company like Netflix to allow the studios to bully them into changing the way they do things. If they don't feel they are being fairly paid, there are several other resources they can use to promote and sell their products. Each company made a separate decision that lead to this result, and there's nothing necessarily wrong with either decision from either party. They each had their reasons and their reasons were sound and valid on both ends.

With that in mind, how is it that a few bad days on Wall Street are a sign of things to come for Netflix? Why is the focus on them and how they are the ones who supposedly lost out on this deal? As I've stated before, they would have had to create an entirely new level of streaming service defined as "premium" for Starz to be happy. Starz probably would have continued providing inferior quality prints of the films and shows they offered regardless, meaning Netflix customers would be paying MORE for pretty much the same content they were already getting. This wouldn't have made their customers too happy and ultimately probably would have lead to an even worse outcome for the company in an even greater loss of subscribers.

It's the choice between the devil you know and the devil you don't. Yeah, they took a hit, but are you seriously going to suggest that they didn't make the right choice here? They had to do what was best for their company and this is the choice that made the most sense. Losing 8% of your content isn't enough to cause the kind of damage that is irreparable. I understand you're not saying that this means doom and gloom for Netflix, but I guess I'm just curious if you're trying to also say that they didn't make the right choice here?

EDIT: And yes, that choice in particular would be the one they made to just let it go, not giving Starz what they wanted. I'm not trying to suggest their actions did anything, but rather their inaction.

[raygendreau]

Netflix Inc. cut its domestic subscriber forecast Thursday by 1 million users, indicating it no longer expects its U.S. customer base to grow during the current quarter after a pricing change angered many members.

Netflix said it now sees 24 million domestic subscribers through the third quarter, compared with a previously projected 25 million and 24.6 million at the end of the second quarter.

News of the 4% cut in its subscriber outlook knocked as much as 16% off Netflix's share price, sending the stock to its lowest levels in 2011


Read more: http://online.wsj.com/article/SB1000...#ixzz1Y2904c9H

See post 346. https://forum.blu-ray.com/blu-ray-te...ml#post5004829

[Jerrin]

Originally Posted by victorvondoom88

Well said.


I believe the point he is making is streaming is for convenience or casual viewing. Perhaps the term "lazy" offended you.
I use it but only to catch episodes I missed or something that is on a premium channel I don't have.
Would I use it to watch a film I can't rent/buyu on blu-ray, sure provided I can't get it on dvd either.
For me the bottom line with streaming is I can't get the quality I want with it with my ISP and internet connection.
I may be in the minority but when streaming Trailer park boys: Countdown to Liquor Day. For the first time my quality actually hit "HD" did it look better than dvd yes could my ISP/connection maintain that for the whole film NO.
Was it sufficient for what I was doing sure. Would I watch everything that way NO. I've noticed more of a problem with action oriented content.

Do I think streaming has its place? Sure. Will it get better over time? Yes. Will I continue to use it? Of course. Will it replace my blu-ray player or collection? Of course not.

I think streaming biggest challenge is the internet infrastructure.

Here is a typical example of my internet speed:


As you can see it says my connection is slower than 56% of the US. Well I really don't have any other option where I live. I could go with Comcast but there speeds are actually slower than that in my area sometimes. Where as mine is pretty steady at 6Mb/s.
Which means 44% have a worse connection. That's about 137,000,000 people in America alone that have a worse connection assuming everyone had internet, which I realize they don't.

I totally agree. I think what most miss is that its an infrastructure problem. If streaming delivered the same quality that blu-ray does, I'd have little problem with it and would use it some. However, the fastest internet speed in my area is 3mb. You can't stream much quality with that.

In many of the areas near me, there is NO "fast" internet. This is the real problem for streaming adoption and the end of physical media. Well, this and the ability of the studios to take our entertainment away if it is all streamed.

[Jerrin]

Originally Posted by JLTucker

I will clarify. "Near flawless" wasn't meant as a comparison to Blu-ray. I meant that it was almost completely free of artifacting, which is a severe problem with many, many streams. Lost looks outstanding but it will look better on a less-compressed disc, obviously.

Now, the big screen issue is really funny, because people who own them fall into the marketing ploy that big is better, even though pixels are larger and more problems are evident. I can only imagine how bad Black Swan looks on a 60" screen with all of the grain due to the camera used. It looks disgusting on my 25.5" screen!

The Black Swan BR looked pretty good on my 138" screen. I didn't like it at all, but that's me.

I'll address your argument. The convience of streaming is very nice. However, the quality of streamed movies, even if you have a great connection speed (which I don't), is still not near what BR provides. I'm not talking just picture quality, but also sound quality ("SQ").

I work at a job that is demanding and I often work weekends. I do not have the time to watch films or shows as much as I would like. Therefore, when I do have the time, I prefer to watch a film in the best possible quality available to me. That's usually BR.

I think I understand your argument, but convience is not as important to me as quality. But I do think streaming has a place for some folks currently. It may for me one day if I can get faster internet speeds and they improve the quality of the streaming, which I have no doubt they will one day.

So in short, I think both streaming and physical media have their place.

[Jerrin]

Originally Posted by JLTucker

Because I don't change my mind unless a logical reason exists to do so? Thinking Large displays are a massive waste of funds is wrong, apparently.

Actually you can build a large screen for very little money. I built mine for $220 and some change. I will conceed that the projector is quite a bit more, but truthfully there are some very good projectors out there for about the same as a TV. I recommend looking at the middle of the pack or even top of the line projectors for the previous year. You can find some stellar bargains that way.

[Jerrin]

Originally Posted by Stoudman

Not to entirely agree with you here, but you're right. We are convincing ourselves that it is great because it is cheap. That quality of streaming is better than most HD cable stations/On Demand services and it costs much less. You get what you pay for, and in this case you get a ton of content at a reasonable bitrate for said price.



Casual film watchers are the ones complaining about the loss of Starz and the price hike. Casual film watchers are the ones dropping Netflix like flies. Casual film watchers are not your enemy in this case.



Wait, what? Your argument just veered off into conspiracy theory territory. Oh wait, you're one of those people who firmly believes that they are trying to phase out all forms of physical media. Give me a break, dude -- there's too much money to be made off of physical media to just phase it out entirely. They're simply providing more options for people to get their entertainment in various different ways.



Why not? I present to you a few situations which are not exactly new to me, and actually tend to happen on a regular basis.

I often find independent content on NIW that I had previously never heard of before. After watching it, I discover how awesome it is and plan to pick up the best possible release of it on a physical media format. NIW served as a tool to get the word out about an excellent film that otherwise would have remained entirely a mystery to me.

Sometimes these movies have blu-ray releases, but more often than not they are only available on DVD. However, on NIW they are available in HD (albeit as you consider it, unacceptable HD). Even based on your opinion of this being an unacceptable level of quality in HD, it's still better quality than the DVD. Still, I'm going to buy the movie on whatever format it is available on because I want to support the artists.

A backwards technology? Thanks to streaming, several independent filmmakers have found a new tool to get the word out about their movies. 90% of these filmmakers would have had to rely on other, outdated forms of advertisement that aren't nearly as effective, and thusly would most likely have been forgotten by time. Instead, they now find themselves getting noticed a bit more -- all thanks to this "backwards" technology of yours.

Just because one format is different than another doesn't necessarily mean that it is bad or that the powers that be intend to use it to phase out other formats. That's just crazy talk.

I agree with all of your arguments Stoudman. Well put.

[Steedeel]

Not wanting to go over old ground but i constantly see people state Netflix Hd is better than dvd quality? does this mean it has fewer compression artefacts or simply Higher resolution. If it is the latter that does not make it better. Just to get this absolutely clear, Netflix Hd 1080p has less pixelation than a well mastered dvd? true or false?

[The_Donster]

I've ask this several times, but I'll ask again....Why do you care SD? Netflix isn't offered in the UK(yet) and you've said you'd never use it. So what does it matter to you specifically?

[pro-bassoonist]

Originally Posted by pro-bassoonist

1. I don't see how I am being harsh towards Netflix. Their strange behavior during recent months has prompted many to question their moves, which were a direct result of what I described to you earlier. Look at how the market reacted in recent weeks while observing Netflix's behavior, and how Netflix's stock performed - quite a bit of harshness there.

Pro-B

The Wall Street Journal:
http://online.wsj.com/article/BT-CO-...15-708825.html

Netflix Sees 1M Fewer Members Following Price Rise

--Netflix cuts subscriber guidance by 1 million, or 4%

--The decline in expected members follows controversial price change

--Stock hits 2011 low as investors worry about slowing momentum

(Recasts first paragraph and updates throughout with additional analyst comments, updates share price.)


By Matt Jarzemsky
of DOW JONES NEWSWIRES
Netflix Inc. (NFLX) cut its domestic subscriber forecast Thursday by 1 million users, indicating it no longer expects its U.S. customer base to grow during the current quarter after a pricing change angered many members.

News of the 4% cut in its subscriber outlook knocked 16% off Netflix's share price, sending the stock to its lowest levels in 2011. Netflix, though, continued to defend its recent pricing change.

The Los Gatos, Calif., company this summer ended its popular $9.99 per-month DVD-rental and movie-streaming plan, and required customers to pay $7.99 a month for each service, starting in September. The price increase caused a quick and harsh backlash among Netflix customers, something the company again acknowledged Thursday.

"We know our decision to split our services has upset many of our subscribers, which we don't take lightly, but we believe this split will help us make our services better for subscribers and shareholders for years to come," the distributor of movies and TV shows said Thursday.

Netflix said it now expects to have 24 million domestic subscribers at the end of the third quarter, down from its earlier expectation of 25 million and the 24.6 million U.S. customers it had at the end of the second quarter. It expects 800,000 fewer DVD-only subscribers and 200,000 fewer streaming-only members than it previously forecast.

The slowdown in Netflix's momentum worried investors, as shares fell 16% to $176.06 in morning trading. Before Thursday, the stock was up 46% over the past 12 months but down 19% over the past three months.

"The Netflix model is a delicate balance between keeping the price right for the consumer and providing them enough content," Wedbush Securities analyst Michael Pachter said. "Suddenly, the value proposition isn't that great. The consumer gets less for a higher price."

Netflix executives have said increased investment in streaming content would lure more subscribers, in turn creating revenue to further build the library. But recent setbacks raised doubt about whether the company will see the "virtuous cycle" executives have described.

"Netflix has been a momentum story--you need more subs to buy more content, which allows you to get more subs," Janney Capital Markets analyst Tony Wible said. "Now you're starting that momentum in the other direction, where you have fewer subs, which could lead to lower content, to fewer subs."

Netflix partner Starz Entertainment LLC recently ended contract renewal negotiations with Netflix after the two couldn't agree on pricing, leaving a potential hole in Netflix's movie and television library. Meanwhile, Netflix faces the risk that Dish Network Corp. (DISH) will build a streaming video or that Amazon.com Inc.'s (AMZN) rival streaming service will gain traction, analysts said.

Netflix backed its earnings and revenue guidance for the quarter. Pachter said the company will likely feel the financial impact of the subscriber slowdown later in the year as the price increase just took effect and the quarter ends Sept. 30.

Pro-B

[pro-bassoonist]

Originally Posted by The_Donster

Netflix isn't offered in the UK(yet) and you've said you'd never use it. So what does it matter to you specifically?

Netflix may not be offered in the UK but LoveFilm is, and its quality is comparable to that of Netflix. Additionally, Netflix has been considering entering the European market, and LoveFilm would obviously be one of their main competitors in the UK.

Pro-B

[Steedeel]

Originally Posted by The_Donster

I've ask this several times, but I'll ask again....Why do you care SD? Netflix isn't offered in the UK(yet) and you've said you'd never use it. So what does it matter to you specifically?

I don't like made up facts. People keep saying how it beats dvd quality yet i have seen little evidence to support this. Just curious, don't be so defensive.

[Stoudman]

Originally Posted by Steedeel

Not wanting to go over old ground but i constantly see people state Netflix Hd is better than dvd quality? does this mean it has fewer compression artefacts or simply Higher resolution. If it is the latter that does not make it better. Just to get this absolutely clear, Netflix Hd 1080p has less pixelation than a well mastered dvd? true or false?

What kind of DVD are we talking about here? Are we talking a Kino release? Criterion? Or just the average release?

You have no frame of reference, but I do. When I watch HD content on Netflix, I rarely notice compression/artifact issues. The only time it ever becomes an issue is if I'm watching a film in which the camera is moving very fast. Being that this isn't a problem with most films, it isn't really a problem with NIW either.

Let me explain how it works since you seem to have never experienced it yourself. When the movie starts, it still looks SD and blurry for a few seconds or more depending on your connection. Their program is such that it often starts up the film before it's finished buffering enough, so for a few seconds the quality will suffer. However, once this issue is alleviated (and often by the time the titles even show up), it's a non-issue. They don't have trouble with blacks (although they may not be as deep). They don't have artifacting or compression issues. They're perfectly fine considering you're only paying $8 a month. Yes, price is EVERYTHING.

Of course, this is all dependent on your ISP. If you have a poor ISP, you're going to get poor quality no matter what you do. Blu-ray does look better, but you get what you pay for.

I'm curious whether or not you or your friend experienced this via computer a few years ago or not, because for a while you would have been absolutely correct about Netflix HD being no better than DVD. However, this was due to Netflix deciding to switch from using a previously successful tool to using Microsoft Silverlight for their streaming, which is a program well known for being completely non-user friendly, impossible to tinker with, and providing the crappiest quality stream I've ever seen. Boy, was I pissed when I found I had been duped into upgrading to their Silverlight version, finding that now everything looked like crap.

However, times have changed and (while I think they still use Silverlight) so has the quality. Everything looks beautiful again. No, it isn't what I would consider "true HD," most 1080p content looking about 720p at best, but once more in case you didn't get the point -- you get what you pay for.

For film fans like me, this isn't a replacement for DVDs or Blu-rays, it's a tool to discover new content we've never heard of or seen before. The service is so pervasive in the world of film that one of the most common questions I hear in every film class I've ever taken is the following: "Is it on Netflix?" $8 a month for what amounts to a virtual library. Does that mean it will be the harbinger of doom for Blu-ray? No. Were libraries the end of books? Nope. Give it a rest, already.

[Steedeel]

Give what a rest. i was just curious to know opinions about the quality. I saw it last year and it was on a PS3. It was a full hd feed apparently. Did not look equal to dvd quality from what i saw. This was on a 55 inch plasma.

[Steedeel]

Isn't the top bit rate 5.8 mbps also. That is pretty low.

[kefrank]

Originally Posted by Steedeel

Give what a rest. i was just curious to know opinions about the quality.

Are you looking for evidence or opinions or both? Earlier in this very thread, I provided my opinion based on direct comparison of the same source content in this post.

Your response was, "I disagree."