Throttling Revisited

Michael writes:

I have, for the first time as a Netflix customer (though off and on) begun to be throttled by Netflix. Sure, I was a naysayer at first, speculating that it had to do with shipping center, location, quantity available, etc. But now, I agree with others that it is a problem; all my DVDs now ship the next day, which effectively reduces my monthly renting ability by almost 25%, and I suspect they’re “receiving” my DVDs later than they really are, which would reduce it by even more. As a person who has always defended Netflix, I have to say that while Blockbuster didn’t impress me, this makes it a lot less easier if I should choose to switch. I’ve got 7 months of a gift subscription left; if Blockbuster’s improved and Netflix hasn’t, I’ll seriously consider changing. It’s a shame, too, but my interests don’t lie in ensuring Netflix’s profitability, but in getting the most bang for my buck.

Are you being throttled by Netflix or Blockbuster? Be sure to include what plan you're on, how fast you turn movies around, and where you live.

Comments

[Teresa]

OHMYGAWD! I thought it was only me! And the more I blogged about my problems with them, the more people thought I was crazy.

And lets not even go into "How I Got DVD 2 of 4 Three Days Before I Even Got DVD 1 of 4." (this happened several times)

Netflix never "received" my DVD's properly, either. Many, many times my DVDs were returned almost as soon as I finished them, only to show up in my returns queue five days later--and my distribution center was only 60 miles away.

Alas, I kicked Netflix to the curb months ago, have gone commando, and began renting from Hollywood Video again.

[William]

I was throttled badly by Netflix and I was a loyal customer since 2001. I was on a 5 out program and it was getting so bad I was getting sometimes a one week turn around time. The kicker is I live an hour from one of their dist. centers in CT. I wrote them telling them I felt like I was being discriminated against, I thought I must be on some sort of black list. They then picked back up but for me it was too late. I cancelled and signed up for Blockbuster and have been happy ever since. The thing with Blockbuster is they know I should be getting a 2 day turn around, they also have a dist. center in CT. So after three days, they will begin shipping me more dvds because they value me as a customer, unlike Netflix. I can even report a dvd return but not received after 3 days and they will take it off my queue and ship me my next one ASAP. That's what I call service. If Netflix wants to be the best of the online rental services it better start treating it's customers better, or more people will walk away like I did.

[BoB]

ALL my movies are now received back overnight since NF opened a new center in my city. But, about 50% of my movies ship from another center which delays me a day (shipping tomorrow) and then the 2-3 day travel time. I don't know if its because the center is only 3 weeks old and has a low inventory or if NF is just speading the existing movies across more centers.

[Aaron]

I didn't know you guys had vocab for this.
I'm really streaky with my returns. There are months where I will average three or four days to send my movies back and other times of the year when I will drop them off at the post office the next day. When I'm slow to get them back NF is super quick. But after three or four next day returns on my part they immediately slow to a crawl and it takes several late returns to get them back up to speed. I wonder what their formula for this is.
I'm on 'three out' in San Diego

[slidenby]

I just signed back up for Netflix after having canceled my membership a few months ago and trying out Blockbuster. I had been a subscriber to Netflix since its launch, but wanted to try out something new in case I could save a few pennies. I wasn't happy with Blockbuster (needless to say) and was glad to have my Netflix rental que back in order... until at least, my first few movies arrived.

Netflix has a center in my city, in fact I live only a few blocks from it. I was used to (before I canceled) receiving my movies overnight, sometimes two days - but now it takes 3 days to get my movie and 3 days back, at least. Movies I have returned several days after another are arriving before the more recently returned movies. IM PISSED. 80% of the movies in my que now read "awaiting shipment" for at lest 24 hours before they are even reportedly shipped out. It is very obvious to me that Netflix is delaying shipment and receiving confirmation in order to save money. I was happy to be back at Netflix, not anymore. I'll finish out this month and then go back to downloading all my movies off the Internet.

[Nat]

I don't know how these self-identified victims are able to tell the difference between Netflix's personal beef with them and the overall demand on the shipping center, but everybody whose service level dips at all sure seems willing to leap to the conclusion they're being throttled on purpose.

I'm a pretty darn high-volume renter, generally at 15+ per month on the 3-out plan, and while occasionally there are annoying delays, well over 80% of the time I get one-day turnaround. When Federal holidays fall on Mondays, I sometimes get zero-day turnaround -- they put the movie in the mail to be collected Tuesday morning, and I get it Tuesday afternoon. Good trick.

[mnxmfan]

I am being throttles as well, although at this point, I believe its due to voluem. I have been on the 5 out plan since November, and tend to return my movies within 1-2 days of watching them. I live near the Minneapolis center, and here has been my experience.

I watch 1-2 movies on Friday night, return them on Saturday, they arrive on Monday, and my next two movies ship on TUESDAY. I can only assume this is due to the volume of returns they get on Mondays and Tuesdays (more on that in a second) which is fine by me BECAUSE, should I really expect that Netflix hires more people to work on Mondays and Tuesdays, and then not work Wednesday through Friday? Probably not, so the higher volume renters get delayed a day to balance it all out. Is it great, NO, but it is reality, I still get cheap movies and a great selection.

Anyways, back to the facts..

Saturday and Sunday I watch the other 3 movies I have at home, and they get shipped back on Monday, arrive on Tuesday, and my next 3 movies ship on WEDNESDAY, sometimes one will ship on Thursday, but that is rare.

On Wednesday, I get two more movies (that shipped on Tuesday) unless the title I want is one they have fewer copies (older titles, and some not so popular titles) ehivh ship from alternate centers. I usually get at least one movie per Wednesday, watch it, return it Thursday, it arrives Friday, and I have another movie shipped to me to arrive on Saturday.

So thats 6 movies a week, average 4 weeks per month, turns out to be 24 movies a month. Not to shabby I'd say, and it brings my cost per movie down to about a buck and a quarter.

Is it perfect? Nope. Is it worth bitching about? Not in my opinion. Why? Because I dont have to drive to the moviestore and drive back daily, AND I still save about 2 bucks a movie compared to the local video store. Bottom line here is that for the selection, and service I get, I am fairly happy. If selection and features didnt matter to me, I could just go down to Blockbuster and get Moviepass and rent two movies a day. There's the most bang for your buck at less than 50 cents a movie. But then again, add in the cost of gas etc and your right back up at that buck and a quarter pricetag unless you live close to a BB.

[tward]

The website that shows your throttle rate is:

www.tallrock.net/RentalStats

(Throttle rate being defined basically as encountering "shipping tomorrow" and "shipping the day after tomorrow" situations).

[Phil A.]

Add another person to the list of people being throttled!!! In my case though, I cancelled and emailed them the reason for doing so. -Phil A.

[Bart]

"I can only assume this is due to the volume of returns they get on Mondays and Tuesdays which is fine by me BECAUSE, should I really expect that Netflix hires more people to work on Mondays and Tuesdays, and then not work Wednesday through Friday?"

If the so-called throttling is just a result of Netflix shipping centers consistantly being overloaded on Monday and Tuesday, I don't think as customers it's too much to expect Netflix to do what it takes to correct the problem. Look at any other business that goes through heavier peak times during the week. They staff appropriately to compensate for the additional demand. The big difference is that these businesses stand to gain financially by being able to handle more customers, while Netflix actually loses money with the higher thoroughput.

Netflix has a churn rate issue, and at its' core is customer satisfaction, throttling is the most common cause of this. They also have to keep the cost of getting new customers down, I think the last I heard it is something like five dollars for each customer.

Shifted from a previous post ( with a small amount of editting ):

Look, Netflix is in the business of making money from shipping people DVDs. Their dream customer is someone who subscribes, gets their three discs and is never heard from again, except paying subscriber fees ad infinitum. Maximum profit.

Their worst customer is Manuel, who continues to rent to the point of maximum throttling, and bitching in public about it the whole time. Minimum profit.

Netflix's biggest issue is keeping the minimum profit at or slightly above their cost - to do so they need to throttle. People with same day or next day turn-around have to be throttled for them to make money, this is what businesses do. This is what Netflix does.

So Netflix throttles, nothing wrong with that per say. They have every right to do that, and our bitching about our inability to make them lose money is senseless, we have no right to put them out of business. In a best case scenario, for the customer, you should be able to rent about 22 to 28 discs a month on the 3 at a time plan. Anybody get anywhere near that that?

So if throttling isn't wrong, what is Netflix doing wrong? Why do heavy renters leave Netflix? Two reasons, Netflix creates a set of expectations, unreasonable expectations, when signing up they claim they give you "unlimited rentals" ( from above, see renewal page: "$xx.xx Netflix x-at-a-time / Unlimited rentals - up to x movies out at a time for a flat monthly fee of $xx.xx plus any applicable tax" as a service option ). The second reason, is that they bloody lie about it (support and in official statements). These are the reason I quit, expectations and lies.

Netflix is creating unreasonable expectations, and lying about it. If that doesn't piss you off, then you ain't paying attention. They can throttle, that is their business - showing disrespect to the people that they profit off of is just unethical, and wrong.

Stop complaining about it, quit and find another service, it is the only way Netflix is going to get the message - when it effects their bottom line, or their brand, their identity.

[Mike C.]

How funny, I thought I was the only one, too. ;) This past month, almost everything is shipping to me the next day. In the months before that I was enjoying same day shipping.

I like Netflix (a lot) so this is frustrating.

Quoted from Netflix's Terms of Service:

"In determining priority for shipping and inventory allocation, we give priority to those members who receive the fewest DVDs through our service. As a result, those subscribers who receive the most movies may experience next-day shipping and receive movies lower in their queue more often than our other subscribers."

Netflix has legally added a section telling you if you are a high volume user, you will be discriminated against and they will service the low volume user(aka the ones they make more money from) first.

Blockbuster Online does not discriminate against high volume users, they treat everyone equally. I have had both, and I was throttled by Netflix after the first month, it only takes their software a little time to learn your rental habits, and if you rent too much to be profitable, you WILL start receiving slower service the longer you stay with them.

You still actually get a good value IMO, but only compared to renting from a store. For online, I will let Blockbuster service me. No throttling, lower price, plus 2 free coupons...sounds like a winner to me.

[Michael]

Thanks tward, I used that website (as everyone should, it's real informative!) and it confirmed what I said - the amount of "gaps" between receiving and shipping is up and increased this month for me, and makes up 67% of the total gaps of my membership (and June isn't even over!). Thanks again for the site!

[Michael]

Whoops...interpreted it wrong, but it's still the right conclusion - normally my DVD rentals are delayed between 0 and 15%, but this month they have been delayed 67% of the time...it's just nice to have statistics to back this up, haha.

[nouseforaname]

So inventory level fluctuations never play into it? It's always a conspiracy?

[jeff]

I view and return movies pretty much on a set schedule, so it was easy to notice a blatant slow-down that began a few weeks ago.

Netflix gets my returns on Monday morning, and they're logged as returned almost immediately.

Movies from my queue are also pulled into shipping slots almost immediately. But..

Monday: Shipping Soon
Tuesday: Shipping Today
Tuesday evening: Shipping Tommorow
Wednesday morning: Shipping Today
Wednesday evening: Shipping Today
Thursday Morning: Shipping Today
Thursday Evening: Shipped

They finally figured out how to eat up an entire week before my selections arrive.

Oh, btw, I live 10 miles from a distribution hub.

Jeff

I get nearly twice as many movies from Blockbuster for ten dollars less every month.

In the past I've noticed them doing it. Now I seem to cancel my account every few months due to lack of interest and the DVDs are prompt when I come back. If I was an active user I'd do two months on BB, two months on Netflix, rise, and repeat.

[Michael Moulton]

During the winter, I was watching 3 movies every weekend, and mailing them back Monday. The new ones would arrive either Thursday or Friday.

For the summer, I'm watching more TV DVDs on weekends and my Netflix rentals during the week, so I'm going through movies slower than during the winter. Turnaround time hasn's really changed-- I mailed one back Tuesday and its replacement should be here tomorrow.

[AARRGGHH!!!]

Count yourself lucky. They're delaying my shipments 4-5 days from the time I put them in the mail. This would be impossible for same-city mail, unless a postal worker is borrowing my movies. At least Blockbuster has picked up the slack - they now deliver 50% more movies than NFLX with no throttling. Netflix used to be faster than BBO. I'm annoyed at being subject to these secret rules and penalties. They should treat customers honestly. Current prices are not realistic. I'd be glad to pay $21-24 for the service I used to get (18-22/month). I wouldn't feel as bad if they set a limit of 12 a month on 3-out...

[no shiri deku nes]

"everybody whose service level dips at all sure seems willing to leap to the conclusion they're being throttled on purpose."

Because it's obvious and there's no way they can hide it. If it takes a day each way during my trial and first few months, then suddenly 2 or 3 or 4 days each way, and all my movies say "Shipping Tomorrow", how do YOU explain it? Netflix seems to think we're morons and won't notice such discrimination. It's about as subtle as having a drinking fountain labeled "whites only."

[Nat]

"Because it's obvious and there's no way they can hide it. If it takes a day each way during my trial and first few months, then suddenly 2 or 3 or 4 days each way, and all my movies say "Shipping Tomorrow", how do YOU explain it?"

Off the top of my head, with high demand on your shipping center, high demand for your movies in particular, staffing problems at any shipping center in your region, software problems, mail delivery problems, and/or a possibility that you're actually being throttled. There is no way for you to know the relative proportions, and anecdotal insistence is not evidence.

I rent as much as a lot of people who say they're being throttled, and I'm plainly not being throttled, so the situation is just not clear-cut.

It's extremely annoying that this debate always winds up being so one-sided. People experiencing bad service assume they're being victimized (going to the point of embarrassing themselves with civil-rights analogies), and people experiencing good service generally have better things to do than correct them. It's a vicious circle.

[manuel]

Netflix will never live down throttling customers. It was word of mouth that initially brought Netflix customers and it's word of mouth that's currently driving those same customers to other services like Blockbuster. What subscriber wants to be chastised as a "heavy user?" Why did Netflix spend a whopping $12.5 million dollars last April on advertising--out spending giants like Amazon by $10 million dollars? Blockbuster Online seems to do well without spending a fortune on advertising.

Regardless, this is my comparison of services...

Turnaround:
Netflix 2.5 days
Blockbuster 2.7 days
GreenCine 3.6 days

(all plans 3-at-a-time)

Although both Netflix and Blockbuster give me similar turnarounds, Netflix is slightly faster. If you're a customer interested in speed then Netflix is your choice. If you're interested in value then Blockbuster prevails. However, if your interested in reliable service then GreenCine is the winner. I found a happy medium by subscribing to all three. Netflix isn't the only game in town. Customers can pick and chose.

[pagan god]

"high demand for your movies in particular, staffing problems at any shipping center in your region, software problems, mail delivery problems, and/or a possibility that you're actually being throttled."

Failure to address staffing problems, demand for movies, and software problems is in itself throttling.

"There is no way for you to know the relative proportions, and anecdotal insistence is not evidence."

There are things that we know are true but can't prove. You get a feel for things by experience and observation. Many things are communicated without words. To say that "anecdotes are not evidence" is meaningless. First, we aren't giving anecdotal evidence. Second, trite slogans aren't evidence. Maybe I don't know what throttling is, but I know it when I see it. Sound familiar?