I bet most folks keep cable or satellite for the same reasons we do -- a limited amount of first-run programming and live sports. Throw in an
and you're easily paying over $100 a month for a small, hardly-filling meal at an overpriced French restaurant.
Netflix needs to find a way to tell this story. And charge more.
As it signs more exclusive deals, like
the recent one with Disney (
), Netflix gathers pricing power with the consumer.
That, however, does not change its two-pronged predicament. One, big media fleeces Netflix for the content it knows Netflix desperately needs to remain valuable and competitive. Two, at $7.99/month how many more huge, exclusive Disney-like deals can Netflix expect to sign? Programmers do not want their premium content viewed by a growing Netflix subscriber base at a low all-you-can-eat price.
Netflix can't ramp from $7.99 to much more than $10.00 a month (if that) overnight. That's the company's own fault. However, it needs to do something -- sooner rather than later -- to get the revenue it deserves out of its subscriber base. Reed Hastings must get creative.
--Written by Rocco Pendola in Santa Monica, Calif.