Netflix Offers Streaming Only Plan for $7.99, Raises By-Mail Plans $1

Woman retrieves Netflix envelope from mailboxNetflix is not going to tinker with the brand it has built around delivering DVDs by mail in iconic red envelopes, but in order to fit the changing demands of its users -- and pay the cost of shipping enough stacks of DVDs every week to eclipse Mount Everest -- Netflix is changing its rates.

The biggest change is that Netflix will offer U.S. Customers an unlimited streaming plan for $7.99 a month and that it is raising the cost of the one DVD and two DVD plans by $1, effective immediately.In an email to subscribers and on the Netflix blog, VP of Marketing Jessie Becker explains the reason for the change, "Our selection of TV episodes and movies available to stream has grown dramatically, and as a result, most members want us to deliver unlimited TV episodes and movies two ways: streaming instantly over the Internet plus DVDs by mail. The price increase will allow us to continue to offer the popular plan choice of unlimited TV episodes and movies streaming instantly along with unlimited DVDs."

The $7.99 a month, streaming-only plan will likely be pretty attractive to some Netflix users since it includes numerous TV shows and 28,000 streaming titles. While not every TV show or movie is available to stream from Netflix, the movie selection is much better than Hulu.com, which just launched Hulu Plus for $7.99 a month with access to more than 120 seasons of TV shows. We compared these two services in our recent streaming TV and movie showdown, and found that movie buffs are better off with Netflix while TV junkies may get a better fix on Hulu.

The problem most users will run into as they try to switch over to a streaming-only plan is that the selection is much less than what is available on DVD by mail. Many times the latest releases are not available on Netflix to stream, even after the 28 day delay to arrive on DVD. Another issue is that sometimes a movie that can be streamed will no longer be offered as a streaming option. Hopefully, the recent deal with EPIX means Netflix streaming subscribers can count on consistent access to new releases from studios like Paramount, Lionsgate and MGM.

Netflix's selection of streaming movies and TV shows is improving, and can be part of an overall attempt to cut the cord with your cable company and stream everything you want to watch; but the unfortunate reality is that to watch every show you want, you'll still likely need a Hulu Plus subscription and have to watch some episodes at other online locations. For movies, you may want to look into supplementing your Netflix streaming plan with a few trips to your local Redbox.

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