Gizmodo
What kind of price war is this? Yesterday we saw proof of Netflix cutting a dollar off its three-disc at-a-time plan resulting in a $15.99 monthly tariff, and today a tipster shows us an email from Blockbuster talking about raising prices. But there's some good news in that email for existing customers.
The good news is that Blockbuster has decided not to raise prices for its existing customers. Our tipster was understandably relieved to see that his plan won't be affected by these changes. The tipster's two-DVDs-at-a-time unlimited plan (as long as exchanges are made in the store) runs $14.99 a month, but he's telling us Blockbuster will be charging $21.99 for that same unlimited plan for new subscribers after August 31.
Blockbuster decided to make those changes a few weeks ago—we knew about its crippling of its unlimited plans back on July 27. That was long before Blockbuster heard about that Netflix price cut announced yesterday, which some commenters here on the Giz told us was not applicable for subscribers living on the East and West Coasts. But then we heard that a Netflix call center employee got a memo saying that the Netflix price decrease on its "three discs at a time" plan affects 6.7 million customers. Sounds like a majority.
It's great that existing Blockbuster customers won't see a price increase unless they change plans. But come on, Blockbuster, you can do better than that. It's your move. Netflix has a three-movies-through-the-mail price of $15.99, and your price for that same plan is $16.99. Let's see a corresponding price cut for 6.5 million of your customers. [Thanks, Ben!]
Comments
I used to subscribe to Blockbuster about a half year ago, until their shoddy processing was causing me to not get DVDs, not show that returned DVDs had cleared the system, or them not sending DVDs to fill the open slots I had in my 3 at a time plan.
We had similarly been notified of a price increase that wouldn't affect us. As a "preferred customer" they were just happy that we were subscribing to them. However, about 3 months later, the "preferred customers" received a similar price increase, setting us on the same price teir as the newbs.
From my understanding, and based on what the email says...existing customers are unaffected by the service changes and price increase.
Sorry to steer away from the article...but does anyone know what the discounted game price is for the in-store exchange?
AND BTW....GO PREFERRED CUSTOMERS!!!
I guarantee that Netflix got wind of this in advance and that's why they decided to DECREASE their price and before Blockbuster made their announcement!! GO NETFLIX!!
WOW. Blockbuster is really gonna go down the drain. 15.99 and 21.99 is a BIG difference -- hmm...wonder who I'D sign up with???
Blockbuster just lost my business. I noticed the price change before they sent out these letters, so I downgraded to protect myself from the price increase, only to find out that it wouldn't haved applied.
They should have communicated with their customers earlier. When I called them to see if they would put me back to what I had at the same price, they wouldn't...well screw you blockbuster...I'm a Netflix customer now.
Ughhh. As a local blockbuster employee, the limited in store exchanges = huge headache. Customers get angry at us enough when they find out we don't carry the "English version" of Pans Labyrinth, or when they owe us an extra$1.25 for keeping a movie for 25 days.
Oh well. The continuous loop of spongebob cartoons that play all day will surely keep me sane...right?
$21.99 is for Total Access (Rent Online and then trade returns in the Stores unlimited). I used to have Netflix but I dropped them when BB came out with Total Access which is an awesome program imo. Anyway, it sucks with the price increase but it's a good thing I'm a "PREFERRED CUSTOMER" too.
@rrife:
"At this time" they are unaffected..
I got to see a red-faced man about to explode the other day at blockbuster when he found out you can only rent games with a major credit card.
I'm waiting for my Blockbuster to start renting out Resident Evil 4 for Wii... but so far it's a no-show. :(
@sroemerm:
"I'm an idiot and I want Blockbuster to make up for it."
Blockbuster's plan can't even be compared to Netflix's plan. Who cares if Netflix is cheaper? If there were a Netflix store 2 miles from my house where I could exchange the movie I was mailed for another one to take home, then I'd care.
With Netflix, when you're done with a movie, you wait for the mailman. With Blockbuster, you get a movie whenever you want.
i friggin hate Blockbuster.com and their incompetent employees. I had a very simple issue with my Total Access account that took well over a month to get settled. Instead of connecting me with IT people who could solve the problem, they kept offering me apologies and free coupons for candy and sh!t.
Although I can't complain too much, I've built a 400+ movie collection in the last 6 months by raping their Total Access plan for all it's worth.
Damn. I canceled my account last week because I'm moving and I didn't want to lose 2 weeks of rentals. My plan, 4 out @ $24.99 unlimited exchanges and 1 free monthly game is no longer offered. Grrr.
I've loved blockbuster's 2 out at a time+unlimited exchanges bc I have two blockbusters within 2 miles of my house. At 14.99 it's a great deal. I'm not surprised that they're raising their prices (blockbuster has an in-store only exchange plan - 2 in store rentals out at a time w/ unlimited exchanges for 29.99) but if they raise their price on me I'll revert to netflix.
The nearest Blockbuster to my house is almost 10 miles away.
Not worth paying extra to drive there to exchange movies.
After all, if I'm on the 3-at-a-time plan, when I'm finished watching a movie, I can pop it in the mail and start watching one of the other two, no?
Wow ten miles to get a movie you want right away... So dropping a disc in the mail and waiting 5 days is better?
@mconheady: I waited four days tops for movies when the closest distribution center was in Indy (I'm in Columbus, OH). But now that there's one in Columbus, I can drop off a DVD at the post office on my way to work so it gets in the morning sort, and be notified as early as that afternoon that the next one is shipping. Usually within 72 hours, sometimes 48 I'm watching a new movie.
Netflix's selection trumps Blockbuster. I'd gladly wait a little bit longer and pay a whole lot less for a better movie selection.
I don't wait five days.
I'm on the Netflix 3 at a time deal.
At *most* I have a 3 day turn around. So, if I'm really up to watching a new DVD every *single* day, I can.
My netfix plan dropped $1 on my 1 at a time subscription
Was wondering if they'd ever notice that a 3-DVD at a time subscription is just about as many movies as you can possibly watch a month when you've got two Blockbuster stores within a few miles. I don't even mail in my movies any more.
I just trade in at the store for three more movies while they refill the returned movies for 3 more in my queue. Without a limit on in-store exchanges this turns into dozens of movies a month for any of those particularly anti-social stay in and stare at the TV 24/7 months.
@FACEMACHINE:
That $1.25 charge was part of the no late fees program, right?
This price increase is just another in a long line of "really smart" ideas from the team at Blockbuster. It's right up there with the "no late fees" and the (thankfully failed) attempt at making movies due back at noon of the due date.
@Q:
I've always wondered if Blockbuster suspects that some people (probably a good number of which read this blog) don't actually watch all the movies and play all the games they rent with these types of plans. Of course, I know it's *impossible* to rip a DVD, so these people must just like having more movies than they can possibly watch.
An actual quote from a Blockbuster employee regarding their one of their game plan: "There's this one guy that comes in like three time a day to trade in his games. He must not do anything but play video games all day"
Yeah, and he's really picky about his games.
alas, i did not get the preffered customer treatment and blockbuster have informed me that they will not bill me for next month. Go figure. How did you guys get to be so called "preferred custoemrs"?
Same here, for preferred customer. I was told that my plan would change and that I would be limited to 5 in store exchanges at my current price point.
@BIGVINCE1981
The 1.25 is technically not a late fee. Though it is a fee that is charged when a movie is late, we call it a restocking fee. I actually love it when customers flip out (which happens often, actually) over the $1.25, since it gives me a chance to be a smartass. I offer to remove the $1.25 restocking fee and revert back to late fee program, which would've charged them around $1.30+ each day when the movie is late.
I probably should've stated that the blockbuster I work for is a privately owned franchise. We're not part of corporate blockbuster, so our policy may differ slightly.
That's... odd. I've been with Blockbuster for several months now, and I've not received this email, actually. I wonder if I will have it by tonight. o.o
@rrife: @DeadPlasmaCell: Yeah, at the time I got that same letter back when I was a customer about that increase, it was "at this time". Two months later, I got the increase as well... Time will tell.
I have been a blockbuster online subscriber for about 4 months. i received an e-mail telling me my current plan will not be available for the same price and that if they do not hear from me before Aug. 31st that i will be changed from the "Unlimited Online DVDs up to 2 at a time plus unlimited in-store exchanges each month for $14.99" to the "Unlimited Online DVDs 2 at a time plus up to 3 free in-store exchanges for $14.99."
In other words, Blockbuster online IS raising prices for some of its existing customers.
@stopNgoBeau:
I am also a former customer for almost the exact same reasons.
I've been a Blockbuster member for over a year and I got a email saying my fee will go up to the new pricing and my old plan is not available anymore. It was sent to EXISTING MEMBERS.
Was the "Preferred Customer" a joke...
No surprise that Blockbuster did this as they have been really bleeding red ink.
The competition between them and Netflix has gotten really ugly lately and it's been fascinating to watch both of them "notch it up a bit".
This is the first sane thing that Blockbuster has done to try to limit their costs, but it has certainly has angered all of us.
I'm waiting for the inevitable DVD burn-on-demand that WILL be offered in virtually any street corner retail outlet - just wait and see.
Where will all this end for Blockbuster vs. Netflix?
Who knows?
What with the real competiting coming from RedBox and DVDPlay Blockbuster and Netfix SHOULD be worried.
Let's face it - you either want to rent the "top 20-30" hits or are looking for the more obscure or less-popular titles.
The top 20-30 can always be had quickly and easily at a vending machine, more obsure can be found at a brick-and-mortar store like Blockbuster, but they only have SO MUCH real estate where they can store titles.
Not to mention on-demand from Comcast.
Interesting times ahead in the entertainment business, and who will be the real winners here?
THEY TURNED....I just got email saying that my plan will change, and I have been a member for almost 3 years, and now this....AGAIN!!!
I'me a preferred customer.....Been with blockbuster online over a year now. My plan price has increased and no E-Coupons, sent an email to customer service last night and heres the response:
Hello Josh,
Thanks for contacting BLOCKBUSTER Online Customer Care.
I appreciate you taking the time to write us about this, Josh. Like all retail businesses, we must periodically review our products and services structure. In introducing a wider range of subscription plans, we considered a number of factors related to online memberships including in-store activity on a given account. We're giving our most frequent renters like yourself the option of either continuing with limited in-store exchanges at a the same price point or moving to a new plan if you'd like to continue your unlimited exchanges and agree to a higher price point. Unfortunately, eCoupons are no longer available.
We feel we are still delivering a great consumer value and encourage you continue with the new terms or consider one of the new plans we offer. You can find the details of other plans that are available via "My Account" in the "Subscription Plan" area. If you make no changes online or we don't hear from you, please remember that the changes mentioned will take effect on your regular monthly billing date following August 30th, 2007. Thank you very much for your inquiry.
Concepcion
Customer Care Associate
BLOCKBUSTER Online
Customer (Josh Barry) 08/17/2007 10:51 PM
I've been a loyal member of blockbuster online for awhile now. If you check my last email, i was looking at upgrading my account to 4 movies at a time but didnt because I would lose my e-coupons. I'm not sure what new plan I will go to yet. I want to keep my e-coupons. If I switch to the 24.99 or stay with my current, am I losing my e-coupons. I switched from netflix when i joined blockbuster for the one and only reason of the e-coupons. Will I lose my e-coupons because your company decides to change my plan? If i lose my e-coupons( 2 of them), i will be cancelling my account and will re-join netflix!
Thanks,
Josh
Dear Christine,
We hope you're enjoying BLOCKBUSTER Total Access™!
There are some changes to our subscription plan lineup that introduce a new pricing structure and new plans which limit the number of in-store exchanges.
As a result, your current plan will no be longer be available at the current price.
(Unlimited Online DVDs up to 3 at a time plus unlimited in-store exchanges each month for $17.99)
We'd like to extend you a new plan that includes Unlimited Online DVDs 3 at a time plus up to 5 free* in-store exchanges for $17.99.
In addition, exclusively for BLOCKBUSTER Total Access customers, we have introduced in-store movie rentals for $1.99* per movie should you need more than the in-store exchanges included in your plan.
Your new plan will go into effect on your regular monthly billing date following August 31, 2007. If we don't hear from you by August 31, 2007, we will automatically move you to the new BLOCKBUSTER Total Access plan referenced below as "Your New Plan".
This is the email I just recieved and I have been with them from the start. I am very upset and they just lost a very loyal customer.
This is absolutely ridiculous I have been a blockbuster online customer from the very beginning and all you have done is lower our service and raised our prices I absolutely refuse to go along with this. If this indeed is a change that takes place I will have no choice to leave your service and join net flicks on principle alone. How is it possible that you feel you can so dramatically raise these prices and keep your customers. I don't know how everyone else is going to take this but as for me I am outraged. I have dealt with your increases in the past but this is a $4 dollar a month increase. I use blockbuster online because my family of five is hard to get a weekend of enjoyment for an affordable price. Our movie nights Friday and Saturday are the main ingredient in the stew that keeps my family thick. I know your big corporate rich board members could give a rats butt about my family situation but maybe they need to recall that it was your company's family values that brought many customers away from the small mom and pop video store where the children could by chance come across some very undesirable material. Now that you lead the idusty in this field you decide forget the little people that were loyal to you and lets make the big bucks. I am so sick of big company's like you selling us struggling working class people out, so that all the high on the food chain owner's. officer's and board members can afford there multimillionaire lifestyle.
my response to the crappy email. Like they give a hoot.
many are saying that the plan does not affect existing customers. that information is INCORRECT. previously on the 3 for $17.99 rate, the customer had unlimited in-store exchanges. that has now been reduced to 5. that is a significant decrease for volume renters. so, the price doesn;t change... but the "benefits" do...
It appears that existing customers are NOT protected. I just got an e-mail this morning stating that my $7.99 plan will go from 3 a month down to 2 a month (plus trades). Also it looks like the e-coupon is going away. So, effectively I am down from 7 movies a month down to 4. Can't blame them since they are losing a lot of money, but I'm off to Netflix.
BLOCKBUSTER Total Access™
Dear Lee,
We have introduced a new pricing structure for our lineup of subscription plans.
As a result, the price of your current monthly plan, Unlimited Online DVDs up to 3 at a time plus unlimited in-store exchanges each month for $17.99, will increase to $24.99, effective August 31, 2007.
We will not automatically renew your subscription on your next billing date.
If you choose to continue, please select a new plan.
That's the e-mail I got from Blockbuster.. If I want to continue with my plan (3 a month unlimited in store exchanges and 2 free rental cupons a month) I'll have to pay $24.99 plus tax or I can switch to 3 a month and only 5 in store exchanges a month. I've been a blockbuster customer for 3 years or more but I'm having doubt's.. This is happening just when the company has had its stock upgraded by Wall Street Analysts and when it seems to be crawing closer to Netflix.. It will interesting to see what this new price plan does to the customer base, I'm sure it will alienate existing customers to a certain amount.
I've been a member for quite some time, and I just received this email. So much for keeping the same rate for existing subscribers...
Dear (first name),
We hope you're enjoying BLOCKBUSTER Total Access™!
There are some changes to our subscription plan lineup that introduce a new pricing structure and new plans which limit the number of in-store exchanges.
As a result, your current plan will no be longer be available at the current price.
(Unlimited Online DVDs up to 3 at a time plus unlimited in-store exchanges each month for $17.99)
We'd like to extend you a new plan that includes Unlimited Online DVDs 3 at a time plus up to 5 free* in-store exchanges for $17.99.
In addition, exclusively for BLOCKBUSTER Total Access customers, we have introduced in-store movie rentals for $1.99* per movie should you need more than the in-store exchanges included in your plan.
Your new plan will go into effect on your regular monthly billing date following August 31, 2007. If we don't hear from you by August 31, 2007, we will automatically move you to the new BLOCKBUSTER Total Access plan referenced below as "Your New Plan".
I must not be an approved member because I rent so many movies. I just received my email today letting me know that my plan no longer exists, and that I will have to choose a new plan before the end of this month, otherwise my re-billing will stop.
After all of the other issues I've had with Blockbuster I do believe I will be taking my business elsewhere.
I got the same canned response from Blockbuster's "Online Customer Help," so I responded with the following:
You are not being of service to me. You are telling me that I should shut up and enjoy being raped, and I won't stand for it. You are telling me that I should accept less service for the same price and be happy about it. Are you fracking kidding me?
Like all customers who are unhappy with the treatment they receive from a retail business, I am forced to take the only action I have available to demonstrate my dissatisfaction: I will never spend another penny with Blockbuster or any of it's affiliates. I will never rent from your brick and mortar stores again (Hollywood Video, here I come). I will stop buying previously viewed titles from you as well. I will strongly encourage everyone that I know who currently uses your online service (many of whom do so on my recommendation) to do likewise. That blog that I've been thinking about starting, I just found a good topic to start with.
I sincerely hope that all of your existing customers will make the same choice, so that you will realize that this is not the way to treat the people who provide you with revenue. Biting the hand that feeds is never a good strategy.
It is only recently that Blockbuster has seen the kind of subscriber growth necessary to finally compete with Netflix. I hope you understand that your pricing changes put that growth in serious jeopardy. Feel free to contact me when you have come to your senses, but until then, this is "goodbye" and "go f*ck yourself."
I got my email this morning.I had the 3 at a time and unlimited instore trades.Now there raising it from $21.99 to $24.99.I just canceled my subscription and signed up with netflix.Ive rented so many movies with blockbuster that they dont have anymore instore movies that i want to rent.So just getting them through the mail is fine with me.
I got the same email. I only exchanged about 2-4 movies in store a month but i always used the ecoupons. That was usually when i exchanged in-store since I was there to use the coupons anyway. The ecoupons were really what kept me with blockbuster after the last price increase but now that it's gone, i might as well save money. On top of that, i've been getting an 'internal 500 error' for the last month everytime i try to view my blockbuster queue and BB still hasn't fixed it. I reported and followed up 3 times. I think it's time to cut my losses and switch to NetFlix.