Study A Third Of Netflix's Subscribers May Flee

Netflix could lose nearly a third of its subscribers as a result of its recent rate hike, according to a survey conducted by Marion, Iowa-based Frank N. Magid Associates. Some 16 percent have definite plans to cancel, according to the survey, while an additional 14 percent said they are seriously considering canceling. The survey was conducted on August 22, a week prior to the rate increase, and did not take into account Sunday's announcement by company founder Reed Hastings that he will be spinning off the DVD-by-mail business into a new unit called Qwikster. Significantly, 7 percent of those saying they definitely plan to cancel indicated that their primary reason for doing so was not the price increase but the limited selection of movies available on the Netflix streaming service. Magid president Mike Vorhaus said, "Netflix will need to improve the breadth and timeliness of their streaming content to rebuild major consumer momentum." Some 60 percent of those surveyed said that they used Redbox's kiosks in addition to Netflix and 30 percent of them said that they intend to use Redbox more often as a result of the price increase.

21/09/2011