Netflix Offers New Discount Plan

by , Dec 31, 2013, 12:22 PM
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Growing Netflix now wants to accelerate its streaming TV-video business with a discount pricing plan. 

Netflix’s new $6.99-a-month streaming plan would be available only for new subscribers -- one dollar less than its long-standing streaming plan. The big subscription video-on-demand service has some 31.1 million U.S. subscribers.

The cheaper deal allows videos to be displayed on only one screen versus two screens for the $7.99 plan. Netflix also has an $11.99-a-month service, which allows up to four shows at once. The company announced that plan in April.

Arvind Bhatia, a media analyst at Sterne Agee, says the new $6.99 plan looks to grab the more value-conscious consumer, as well as compee with Amazon Prime, which has a $80 a year price tag -- $6.67 per month.

“While the lower price could attract new subscribers, it could also somewhat cannibalize current subscribers, given how easy it is to cancel and re-signup for the service,” Bhatia writes. “Also, one has to wonder what impact this would have on Netflix's ability to raise prices in the future.”

At the same time, Comcast Corp has recently fortified its Streampix service -- a subscription-based multiscreen video service . It recently has introduced an option that allows customers to download a select number of movies and TV shows for playback later on mobile devices, according to reports.

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