Boost for Netflix

Netflix received some good news today when Walmart announced that it is going to shut down its online rental service and allow current customers to sign up for Netflix at their current low rate. The signs are in place already since Netflix has a huge banner on top advertising Walmart's low prices for DVDs while Walmart's DVD shopping site links to Netflix on the side. While actual subscriber and revenue impact is supposed to be negligible, it is a huge moral boost for Netflix in the DVD rental war against Blockbuster.

I love Netflix. What started partially as a dislike of Blockbuster has grown into genuine liking for the trendsetter in online DVD rentals. We have a bricks-and-mortar Blockbuster within walking distance of our house. And I have been urged by my wife quite a few times to switch to their online service based both on their low price and the 2 monthly coupons for store rentals. But this turned out to be one of those rare occassions when I stuck to my guns :-) I actually feel loyal to Netflix and the difference in prices is just not enough to overcome that.

Netflix is a boon for movie lovers. It is relatively inexpensive, extremely convenient and has a huge collection. I rent about 8-10 movies a month from there, which would've cost me upwards of $35 at Blockbuster. Paying monthly has several other advantages too. I have no hesitation about renting movies I have already seen, a fact that is most useful when having my parents or in-laws here and renting some movies solely for them. I don't mind returning a movie without watching it completely. And my wife and I don't have to select a movie we both like. She can rent Raising Helen if she wants. I'll just watch Rififi the next day :-) With a San Jose outlet center, I get my movies the day after they have shipped and since they ship movies the day before they are released, I see new movies the same day they are released.

Ofcourse, Netflix's troubles are far from over. Blockbuster has the necessary clout to win a pricing war(which they've already done). Amazon, which already has a DVD rental service in England and owns IMDb, has long been rumored to start one in the US. And on-demand cable and online downloads are making steady inroads into the rental market as more households get hi-speed internet connections. But I admire Netflix as a company and hope it tackles these successfully.