Now you must choose: Netflix splits DVD and streaming plans

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Netflix announced changes to its service plans Tuesday, with a move that effectively unbundles its unlimited streaming plan from its DVD-by-mail service.

As we reported last week, Netflix quietly released a new service plan focused entirely on DVD usage. Now the company is taking that as step further, with new service plans designed to give users the choice between streaming or DVDs at $7.99 each. As a result, the company is doing away with the “discount” that had come with subscribing to both services. While previously its streaming-plus-DVD plan cost $9.99, it will now cost $15.98, or the price of both services combined.

In a blog post, Netflix VP of Marketing Jessie Becker announced the new plans and the reasons for the change. According to Becker, when the company began offering its $7.99 streaming-only plan, it didn’t anticipate the DVD-only service. But continuing demand for DVD-by-mail plans meant that asking $2 more for the add-on didn’t make financial sense. So it broke that offering out as its own service.

In addition to the change in plans, Netflix is making a change in its organizational structure: the company is creating a separate team devoted just to the DVD-by-mail service, which will be led by Chief Service and Operations Officer Andy Rendich.

According to the blog post, the change in service plans go into effect immediately for new users, but pricing for existing users will go into effect after September 1, 2011.

Image courtesy of Flickr user Scott Feldstein

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