How Netflix Allocates Movies to Customers

John writes, "I am on the 6 out plan and am a heavy user (1.5 turns per week). My mother in law is on the 3 out plan and is a light user (1 movie a week). I wanted to see if the recently released DVD, “The Man from Earth”, which is a “very long wait” in my queue, would be shown on her queue. It was “available now”."

Netflix explains that they allocate DVDs to customers based on usage in the Terms of Use:

In determining priority for shipping and inventory allocation, we may utilize many different factors, including without limitation, the number and type of DVDs you rent through our service, the subscription plan you select, as well as other uses of our service by you. For example, if all other factors are the same, we give priority to those members who receive the fewest DVDs through our service. The type, number, mix and weighting of the various factors impacting shipping and inventory allocation will change from time to time and will be made in our sole and absolute discretion. As a result of your viewing habits and our operational practices, the actual number of DVDs you rent in any month may vary, and you may experience differentiated service during the course of your membership. Also, such service may be different from the service we provide to other members on the same membership plan.

Comments

[andy]

this is crap. the available now or very long wait is a function of supply vs demand and does not vary by user. It may say vlw, but the light user will get it. more throttling bs.

[kolohe61]

Here comes the flame war...registration required again soon? LOL

[gir]

I remain convinced that NetFlix's prioritization scheme is the fairest approach. Admittedly it is confusing to see long wait in your queue and available now in someone else's, but considering prioritization the difference is accurate. Accurate information is always better.

[Pollardito]

there may be more to this story, do they both live in the same area that they are served by the same distribution center?

[John]

I sent in the story. Both my mother in law and I live in the Chicago area suburb and are served by the same distribution center, Carol Stream, Illinois.

[Steven Hoober]

I have been a customer for years, often at pretty high use rates. For the past two months we've changed viewing habits, and often (on a 5-out plan) are returning all five each week.

And, we get back all five quite rapidly. Sometimes the day after they are returned. Never more than 3 days later. I have seen no increased delay based on our massively increased use, and certainly nothing at all that would imply NF is inducing delays into the system.

Data point of one, and we RARELY watch new releases (they go on the queue where they go, and we see them years later) so use it as you will.

[Jeff R.]

Isn't it pretty well known that you don't get throttled if you only turn over once a week? Isn't it pretty well known that you do get throttled if you consistently turn over more than once a week?

Ever since I dropped down to a max turnover of once / week, I've seen the waits and other evidence of throttling go away. I also don't put every single new release in my queue. Maybe 1 in 5 movies that I get is a "new release" (sometimes a few weeks old) that I missed in the theaters.

[M.]

It's a contradiction to say everyone can rent "without limitation" while also saying "service may be different from the service we provide to other members on the same membership plan."

Isn't this still being hashed out in the class action lawsuit?

[Corey3rd]

We're talking Last Man on Earth - an old Vincent Price title. Odds are that NF didn't buy as many copies as they will of Will Smith's I Am Legend. Less copies means higher demand. Sure it's a shame NF didn't buy more copies when their system shows a certain demand amount.

The film is PD so there's a chance you can pick it up for $1 at a store that has a PD display. Although I recommend the Midnite Movie Double feature with Last Man on Earth with Panic In Year Zero (a great film about LA getting nuked).

[John]

Thanks for the info, but the movie in question is "The Man from Earth" released on November 13 this year and starring John Billingsley and Ellen Crawford. John

[Rich]

What I'm trying to figure out is why I had to wait almost three and a half years to rent Postal Inspector? And then only after calling Netflix and asking why three other available discs jumped over it in my queue when it finally got to be available?

I think they must've had only one copy of it or something like that, since I just can't see this as a popular movie or one worthy of a five-finger discount (since if you can find it in the stores, it retails for around five bucks).

I've probably jinxed it to by talking about it, since it's due to show up tomorrow.

[noe638]

I have always thought their distrubution method was fair...the problem was their consistent denial. Now that people know the ground rules, it seems perfectly acceptable to me that if you are turning a lot of movies, you should move movies that are "Available Now" to the top of your queue. If you want to see movies that are in limited supply, you either have to up your plan or rent less.

[Sdoug]

If you buy a 3 month gift subscription, at the end of the 3 months cancel that account. Buy another 3 month gift sub and start a NEW account. Do this every 3 months would that help avoid some of the throttling?

Or would they not let you set up new accounts using the same CC?

[SirFlixALot]

My family is about as heavy as it comes in use, on a 6-out plan with (usually) 2 cycles a week (so 12 discs a week). I've found that if a return arrives the day before a new, popular title is going to be released, there's a VERY strong chance I'll get it. If a return arrives the DAY OF a release or later, I may not see that popular title for weeks.

That missed-it-by-THAT-much happened for both the new Harry Potter (still Very Long Wait) and Pirates 3 (still Long Wait), but we hit returns on the right day for Simpsons and Balls Of Fury, so we got both.

As a large family with heavy use (who watches TV anymore?) I expect to get waitlisted on the big releases. With a combined total of 400 or so titles in our three sub-accounts, there's plenty of other things to watch in the meantime!

[Brit]

Its bullshit. If I pay the same amount of money as someone else, I expect to be given the same service.

[Jim]

I recently watched that movie, and I wouldn't recommend it. While the premise seems interesting, the film consists of 6 or 7 people sitting in a room and talking, and that's it. They just talk, occasionally someone will get up to get a drink or something, but they just talk talk talk, while not really doing anything.

You'd be better off with Last Man on Earth like someone else suggested.

[Edward R Murrow]

With BBO raising prices and lots of customers moving from BBO to NFLX, just watch the allocation throttling logic kick in. NFLX will most likely experience a DVD shortage with all the new customers signing up over a short period of time. The new customers will get excellent service while the normal usage customers at NFLX will get hosed.

I can't fathom why all customers can't be treated equally by NFLX. It seems to me that the fairest treatment is first come, first served.

In 'Animal Farm' by George Orwell, the pigs become corrupted by power and a tyranny is established under Napoleon the pig. "All animals are equal, but some animals are more equal than others."

[MiniMonkey]

People, seriously. If there are 100 copies of a DVD and 300 people want to rent it today it is not possible to send the disc to everyone who wants it.

I'm a high usage user, but I completely agree that it is only fair to give first priority to the customers who rent less. They are, after all, paying more for each DVD rented.

[Art]

I am sure you did this very scientific test with both pc's side-by-side and simultaneously, right?

Of course you took into consideration that demand on any particular title will change the availability in real-time, right ?

[MiniMonkey]

Also, to Brit's comment "If I pay the same amount of money as someone else, I expect to be given the same service."...
... that's just the thing. You DON'T pay the same amount of money. Every rental you get costs a fraction of what a light renter would pay for renting the SAME DVD.

[John]

Replying to Art's comment, my mother in law doesn't have a computer so I handle her account. By logging into hers and then into mine immediately after I am able to see a virtual "side by side" comparison. The status in my account has remained "very long wait" and the status in her account has remained "now".

[Corey3rd]

hadn't heard of this Earth film. It has Very Long Wait when I pulled it up.

[John]

Based on Jim's comment I think I will take if off the queue.

[Brit]

MiniMonkey I'm paying for a monthly service, not per DVD. So yes, actually, I am paying the same amount of money as every other 3 at a time member.

[Sam]

Throttling is fantastic and I wish they would do more of it to keep their costs down (which ultimately means cheaper prices for the rest of us).

It's completely fair and it doesn't bother me in the least if a small number of users who are not profitable for Netflix complain because they want to have their cake and eat it too (i.e. receive 3 times as many discs and get an equal crack at in-demand releases).

[JustAMom]

Quick question: If mom's queue has it as "Available Now", why not just put at the top of mom's queue and put one of her movies at the top of yours and switch for a round?

Other than to bump the "throttling" discussion to the top (which has been discussed again and again, here and everywhere else), what's the point?

It is what it is. Use the service or don't. I'm on the 8-out plan, rotate somewhere between a medium to high-turnover user and if I want a new release and have an open slot on a Monday, with one exception, I always get it. If I don't, NF sends one of the other 499 items in my queue. Yes, Virginia, there are 90,000 titles to choose from and a good deal of them are better than most new releases.

[profpudwick]

Brit, you are paying the same as another 3 at-a-time Netflix member. But, if you are a heavy user, you are costing Netflix more than other members.

So it makes sense that Netflix would cut your service.

Like if you went into the $8 all-you-can-eat restaurant and made a pig of yourself. Make a pig of yourself with Netflix, and they'll cut you back. Comprende?

[Brit]

I understand the scam Netflix runs. I've never heard of an all you can eat restaraunt not allowing customers certain foods because they eat too much. Oh, and to the person who said that Netflix is going to lower prices because of cost savings via throttling, good luck with that.

[gir]

There's little point in arguing. Some people will never agree that light users deserve a perk commensurate with getting lots of disks each month for the same low price. First dibs on high-demand titles and more reliable one-day shipping is a commensurate perk, but they'll never agree.

I don't pretend to understand their reasoning, if there is any reasoning behind it. It seems sociopathic to me. I wonder what they'd say if they were on the light user side of things instead - truly on the light user side, not just imagining what they'd say if they were.

[Sam]

An all-you-can-eat buffet won't totally cut you off even if you are a pig, but neither will Netflix. But the buffet (if it wants to keep its good customers) might ask Mr. Creosote to not take all 10 shrimp cocktails in one go and save a few for other customers. Whereupon Mr. Creosote will point out that the buffet is a scam and whine about how he is being treated unfairly.

[profpudwick]

Perhaps the inability of some to understand why Netflix, or the all-you-can-eat buffet, would restrict service to more demanding customers is the inability of some to take another's perspective.

If you look at this from your own perspective, you see that you are paying the same as other customers.

If you look at it from the perspective of the business, you would see that some customers are less profitable than other customers.

[M.]

But if I'm a heavy user, that means I'm watching my movies fast and returning them fast. So wouldn't it actually make more sense to send me a new release *before* someone who's going to get it and sit on it for a couple of weeks? That way the limited number of disks gets to more people more quickly.

If Netflix is going to pick and choose who gets which disks when, they should not use the word "unlimited" (or their permutation of "without limitation"). Period.

Again, isn't this being hashed out in the class action?

The thing that bothers me most about people's anger in regards to a "wait status" on certain DVD's is that certain selfish customers expect to always be at the front of the line for every DVD that they want. Obviously, there is a very real supply and demand issue going on at Netflix, especially around certain New Release titles that every peon without any sort of creative imagination wants to get on the DAY that they release; there is a limited supply and Netflix somehow has to figure out how to fairly distribute those DVD's. Many people think it should just be first come, first serve. "I had that movie on my Saved list for ten months, so I should have it in my hot little hand the day it comes out." If you think about this, however, no new customers would ever get any movies in high demand and Netflix's customer retention would plummet into the toilet. It makes sense for those who pay most PER DVD, not per month, or per plan, or who have been customer longest, or who keep the movies for the shortest amount of time, should get the high demand movies first, because they ARE paying more for the same service. The thing that pisses me off more than anything is when people, like M., say that this is somehow infringing on the unlimited nature of the service. Netflix is more than happy to send you any of the other "available now" titles in your queue, which you should have plenty, unless you are just using Neflix to get new releases, which isn't what they system is designed to do, so you will still be turning around just as many movies as your little heart desires, they just won't be those super popular New Releases, which, frankly, will be just as bad if you watch them in two months.

And a comment to the people who have all their wonderfully amusing conspiracy theories about the company. Nothing you do to your account is going to change the way movies are sent to you. Cancelling and restarting every three months won't help. Opening multiple accounts with fake names and different credit cards won't help. Screaming at the CSR and threatening to sue won't help. Any movie that says available now should ship to you. Any movie that has a wait is going to have a wait until another copy gets sent in. They don't have secret stacks of DVD's that men gloat over while twirling their greasy moustaches. There just isn't the supply, so remember back to the water fountain line in Kindergarten and wait your turn patiently. In the meantime, I'm sure Netflix will be more than happy to send you another available movie off of your queue. They have 90,000 to choose from, so please don't pretend that you've seen all of the good ones.

[profpudwick]

M. asks, "wouldn't it ... make more sense to send me a new release *before* someone who's going to get it and sit on it for a couple of weeks? That way the limited number of disks gets to more people more quickly."

M., if the point of Netflix's operation was to get the most discs to the most people in as little time as possible, then yes.

But that is not the point of their operation.

The reason they are in business is to make money. Please ask yourself, "what ought Netflix to do to make the most money?" and then I am sure you will see all this more clearly.

[profpudwick]

Responding to (?) ("Anonymous?") (Do you have a name?) about the New Releases-- you sure have that right.

Given that many users will demand the new releases, what do you think of the idea of charging more for new releases?

It wouldn't cost me anything. I have 490 in my queue, and none of the top 100 are new releases, and by the time I see those 100, the new releases in the bottom 400 will no longer be new.

In regard to conspiracy theories: We have a need to believe in conspiracy theories. Like, the "men" who killed Kennedy. And that the "Civil War" was "fought to free the slaves." And so forth. It reduces cognitive dissonance.

[Sam]

"Unlimited" does not mean infinite, although that seems to be common misconception for some Netflix customers.

"Unlimited" means that there is no preset number of discs per month. It is of course limited by the reasonable processing ability of the company and normal laws of time and space.

What this means to me is that Netflix should be free to give priority to some users for dics in limited supply and that they can even process all normal discs for high profit customers before handling the lower profit customers.

I don't think charging a higher fee for new releases would be a great idea. Like you, it wouldn't affect me much because I have no problem waiting. But too many people are spoiled into wanting everything and right now, dammit! Being so explicit about charging a higher fee would be a marketing disaster.

If the speculation about prioritizing new releases is correct, then the system is basically fair enough as is. If a high-turnover user really wants those new releases more quickly then they can always up their max number of discs.

[M.]

This is not a case of me or anyone "not understanding" Netflix's perspective. I get it. But I still contend that Netflix has set up a contradiction in their terms of service that opens the service up to legitimate criticism. My leveling legitimate criticism does not make me a "sociopath" as a previous commenter implied.

Of course "unlimited" doesn't mean "infinite" - but last I checked, it still means "unlimited". "Unlimited" means that there are no predetermined barriers to service. If a formula exists such that heavier users are *always* further down the priority list, then that is a predetermined barrier to service. Of course not everyone with an empty slot on Monday night can get a new release - so why not randomize the process to remove all prejudice?

The per-DVD cost any one member might be paying is irrelevant from a consumer standpoint because Netflix charges flat rates. In that flat rate system, some people will always use the service more than others.
The all-you-can-eat restaurant is an apt example. If a diner chooses to stay and eat to the point where the flat rate charged by the restaurant is unprofitable, that's the restaurant's problem, not the diner's. There will always be those that pay the same rate but who will eat/use less, but we must remember that this is by *choice*. Those who, by their own choice, use the service/restaurant less will subsidize those who will use it more. That's the nature of a flat rate system. So the idea of light users "paying more per DVD" is false argument - they are *choosing* to use the system less.

Finally, Netflix's goal may not be to move as many disks as quickly as possible - but the goal should be happy customers who happily continue to pay their flat rates, right? That keeps the system working for everyone. If heavier users are consistently and purposefully asked to wait for popular releases (especially after they've been told they'll receive service "without limitation"), the result is annoyed customers. A randomized process is the only fair solution.

[gir]

Told you. No point in arguing. They won't agree that giving priority to light users serves to balance the value of the service between users, that it makes it more fair.

[M.]

There's only no point in arguing when you can't back up your point of view with facts.

[Brit]

Its not worth the fight M. This place has turned into the Yahoo message boards. Its all a bunch of stock pumpers trying to get people to buy NFLX stock. Nobody wants to have an actual discussion or listen to reason.