Netflix: Testing Blu-ray Price Hikes Soon (NFLX)

As promised, Netflix will start testing higher prices for hi-def, Blu-ray movies “very shortly,” CEO Reed Hastings said on the company’s Q2 earnings conference call this morning. Depending on how those tests go, the company will implement the new pricing across its subscriber base of 8.4 million people.

Blu-ray rentals still make up a “very low,” low single-digit percentage of rentals, Hastings said, but that should grow later this year and next year as cheaper Blu-ray players show up in stores this holiday shopping season. No specifics on what the price increases will look at, but we’d previously guessed it’ll be a $1-$2 per month premium.

We have wondered how Netflix (NFLX) would handle the fact that hi-def Blu-ray discs cost them more than standard-def DVDs. In March, we estimated that while standard DVDs cost the company around $18, Blu-ray discs cost about $23 — or about a 28% premium.

See Also:
Netflix Q2 In Line, EPS Strong, Q3 Guidance A Bit Light
Netflix: We’ll Charge Extra For Blu-ray Rentals
Netflix’s Next Step: More, Better Streaming Movies

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