Netflix Price Hike Coming – Despite Big Profits

Apparently $1.27 billion in revenue and earnings of 86 cents per share justifies a price hike, if you are Netflix that is.  Just one year ago, Netflix showed earnings of just 5 cents per share, and $1.05 billion in revenue.  The company added 2.25 million new US subscribers, and 1.75 million new international subscribers boarded the Netflix express.  The DVD business is meanwhile slowly withering away, with just 287,000 customers left.

A letter to shareholders yesterday explained Netflix’s intent to raise prices $1-$2 for new customers, with current customers keeping the current $7.99 pricing for “a generous time period” – whatever that means.

These higher prices are no doubt a result of the “shakedown” that Comcast gave Netflix, which you can read about that here.  You can also expect to see more price hikes and more shakedowns, as the ISPs slowly abuse their power, and continue to charge unfair rates for sub-par bandwidth; like a troll guarding a bridge, demanding a costly red herring from anyone wanting to cross.  Net neutrality must become a reality, or soon your content will be at the hands of companies like Comcast, deciding who can pass and who will creep by at dial-up speeds.

Netflix has publicly come out against the Comcast/Time Warner merger – as has almost everyone else on the planet.  This very public display of disapproval of the already hot topic is another feather in the cap for opponents of the merger.  Perhaps the Netflix payment to Comcast was designed to undermine Comcast’s efforts to acquire Time Warner, almost as a display of the kind tactics a company like Comcast will be known for, and have more power to do so once they acquire Time Warner?