Things are changing fast in the Web video space, with Netflix and Fox raising the ire of frequent users.
Netflix said that while it "hates" upsetting customers by raising prices as much as 60 percent, the customer backlash to the rate hike announced last week would likely stifle growth and hurt earnings in the short term. But in the long run, Netflix expects the price hike to yield some important benefits and may help the company hit a key benchmark: generating $1 billion in revenue during a single quarter.
No doubt, many Netflix subscribers won't be impressed with that figure since some of that money will be coming out of their pockets. For people who hoped Netflix would reverse its decision on the price increase, the company's remarks suggest that isn't going to happen.
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Meanwhile, Fox Network put up a de facto pay wall around its content when it announced it will begin delaying Web access to many of its popular TV shows to give cable and satellite TV providers greater exclusivity with programming. Beginning August 15, only those people who subscribe to a participating video distributor will be able to view TV shows on an Internet portal the day after shows air on the network.
All other viewers who are used to seeing episodes of "The Simpsons," "Bones," and "Glee" for free the next day on sites such as Hulu or Fox.com will now have to wait eight days to catch their shows. The service is seen as a defensive move designed to preserve advertising rates and subscription levels in the face of mass defections to free Web-based video services.
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