Netflix is offering a $7.99 per month streaming-only subscription
plan to U.S. customers, while at the same time it is raising prices for
its DVDs-by-mail packages by 11% to 18%.
According to Netflix, its members now watch more content streamed
over the Internet than via DVDs on an hourly basis. The rise in
streaming is taking its toll on broadband networks, with Netflix
accounting for more than 20% of bandwidth usage during peak times in the
U.S., according to a survey by Sandvine.
"We are now primarily a streaming video company delivering a wide
selection of TV shows and films over the Internet," Netflix CEO Reed
Hastings said in announcing the changes. "Today's action reflects the
tremendous customer value we've injected into streaming from Netflix,
our initial success with a pure streaming service in Canada for $7.99 a
month and what our U.S. members tell us they want."