Ever since Netflix thought it'd be a good idea to raise its prices, people have started to turn away from the company because they feel that it's unfair that the company felt it was better to raise prices. This price raise backlashed on the company, causing it to lose many customers. Now Netflix has another problem to face, which is the decrease of its shares that went down 40% on Tuesday. Now the company is rethinking its strategies, especially raising prices and trying to divide its online and DVD services into two different companies. Now Netflix is saying it will lower its DVD subscriptions but people who pay for its online streaming service will be charged slightly more. Although Netflix has enjoyed its success with its online and delivery services, people might start to shift towards its competitors, Amazon and Google's Youtube, which offer similar services.
My View:
It seems that Netflix is in dangerous waters right now and they must be very cautious with their next move, which could potentially cause the company to come crashing down. Many of Netflix's customers have already turned away from the company and are choosing other alternatives over Netflix's services. The company made a bad move by increasing its prices and ever since then, Netflix has had its share of bad luck. Even when the company tried to create two different services, one that's online and one that deals with DVD serivces, it didn't prosper from the move like it hoped it would. Seeing how the chain of events panned out for Netflix, there's no doubt in my mind that the company has to do more research and really dig deep when making its next move.
http://www.huffingtonpost.com/2011/10/25/nflx-netflix-stock-plummets_n_1030335.html
So NFLX prices have increased… Wow! What should we expect, after this news what investors are expecting from the market?
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