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5 Retailers Keeping Video Rental Alive

Stocks in this article: NFLX

Netflix

Well, Netflix is still in the DVD-by-mail service. Unfortunately, it may not be in it for much longer.

Netflix boasted 7.15 million DVD subscribers in its last quarter. That would be great if it didn't have 8.6 million at the same time last year and more than 14 million when it split its DVD and streaming services in 2011. That DVD audience is still expected to contribute $96 million to $110 million in profits for Netflix this year, but that's clearly secondary to the $165 million to $177 million being generated by streaming.

It's also a fraction of the more than $410 million in profits DVDs generated for the company just a year ago. Remember when Netflix used to really care about DVD turnaround, delivery logistics and things related to the U.S. postal service? Yeah, that's kind of out the window, too, as the company continues downsizing from 58 distribution centers 2011 to 39 today. A handful more are expected to go within the next year.

It's a shame, as Netflix's DVD holdings are still extensive and include content such as HBO programming, which will never see the light of HD television on Netflix's streaming service. It's still where a whole lot of Netflix's best offerings reside, but the price hike and downgrade in priority suffered by Netflix's DVD branch in recent years -- including the marginalization of customers' DVD queue in a recent site "upgrade" -- makes it feel a whole lot less accessible.

Netflix has also done a great job of making the whole DVD enterprise seem less convenient. Streaming may not give you all the content you want, but it reduces the wait and hassle for content that's there. Movies don't become huge roadblocks when it turns out you're not in the mood for a particular genre and, when they turn out to be duds, there's no four-day penance period before you can watch a new one.

Get your DVDs from Netflix if you must, but Netflix's mission seems to be similar to that of Blockbuster in its final days: To make the DVD rental experience as unattractive as possible.

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