STACEY VANEK SMITH: Shares of Netflix are down more than 3 percent this morning. That after the company announced steep price hikes for video streaming and DVD rentals — customers have been up in arms.
John Moe hosts Marketplace Tech Report. He joins us now to talk about this. Good morning, John!
JOHN MOE: Hi Stacey.
SMITH: So John, it’s been almost a week. How has Netflix handled the negative response from users?
MOE: Fumblingly, haphazardly, in a stumbling manner, in a manner reminiscent of the only Soviet Union — just lock themselves in the Kremlin and wait for the storm to pass. There just wasn’t much in the way of an official explanation as to why this was all happening. And it probably would’ve gone a long way if they just said, “Look, we’re trying to get you more movies, more great TV on our streaming service.” You’d still have people upset, but it probably wouldn’t be this nasty.
SMITH: Well, speaking of damage, all of these people who are complaining, is there any indication they’re actually going to cancel their service or are they just griping?
MOE: There are certainly other options people can go to. Amazon has a streaming service. Redbox has all these DVD kiosks around the country. But Netflix is pretty well positioned to be source for all those things. And that kind of maximizes their convenience. And they’ve got a big boost coming out. On July 27th, the “Mad Men” catalog comes to the streaming service.
SMITH: Oh yeah.
MOE: And I think once more and more titles start showing up, and people say, “Oh, I’m getting more out of this than I used to get out of it, a lot of this stuff won’t necessarily be forgotten, but the value would probably be better represented.
SMITH: The Don Draper Bump.
MOE: The Bump. The Draper Bump.
SMITH: John Moe is host of Marketplace Tech Report, thank you so much John.
MOE: Thanks Stacey.
There’s a lot happening in the world. Through it all, Marketplace is here for you.
You rely on Marketplace to break down the world’s events and tell you how it affects you in a fact-based, approachable way. We rely on your financial support to keep making that possible.
Your donation today powers the independent journalism that you rely on. For just $5/month, you can help sustain Marketplace so we can keep reporting on the things that matter to you.