Mail Order Movie Subscription Services
The Pros and Cons of Using Online Rental Companies
Dec 7, 2008
There are many ways to rent movies these days. One could take a walk down to the local video rental store, download a film on the internet, order one up from a television service provider or even receive movies in the mail.
Netflix, Zip.ca and More
The online movie rental industry is lead by Netflix, the American company that was the template for all other such subscription services. Netflix was established in 1997 and now has approximately 8.2 million customers in the United States. The biggest name in online movie rentals in Canada is Zip.ca, which has partnered with Rogers, one of the country’s largest multi-media companies, which owns nation-wide video rental chains. Other mail order movie subscription websites include Cinemail.ca, Videomatica.ca and Canflix.com. For an unlimited, 2 DVDs at a time package, a customer will pay about $25 per month with most companies. The subscription fees vary if the customer wants more or fewer DVDs at a time.
How Online Rental Works
The customer pays a fee per month, usually depending on how many DVDs they want to have at once and how many they will rent during the time period. Most online rental sites have unlimited options, which means a customer can rent as many DVDs as they wish during the month. The customer makes a list of the movies he or she wishes to rent through the website and the company sends movies from the list to the customer through the mail. When the movie is returned in the provided postage paid envelope, another movie from the list is sent out.
The Pros of Online DVD Rental
The main benefit of ordering from an online DVD rental company is that one never has to leave the house to get a movie. On a blustery, snowy day, this becomes even more important. The customer has access to an extensive collection of films (over 100,000 titles from Netflix and over 72,000 titles from Zip.ca) including some rare and hard to find titles. Paying one monthly fee means you don’t have to worry about shelling out for each rental. Customers can keep the DVDs as long as they want so there are no late fees.
The Cons of Online DVD Rental
The main complaint leveled at the online DVD rental industry is over the practice of “throttling”. A customer on an unlimited plan that regularly rents a very large number of films is less profitable than one that rents fewer films. When the delivery costs start exceeding the subscriptions fees, a company may employ the practice of throttling (or a “fairness algorithm” in Netflix terms) to even out the delivery rentals. This may result in longer shipping times for more frequent customers and preference given to less frequent customers when it comes to New Releases. Zip.ca has instituted “capped” plans (wherein additional shipping charges are incurred for rentals over the cap) in order to avoid having to use throttling.
Other criticisms customers of online DVD rental companies have expressed include receiving damaged discs, being held responsible for DVDs that were lost in the mail and not receiving enough New Releases or popular titles. The DVDs are shipped based on what is available, so the movies at the top of a customer’s list may not be the ones they received (especially if the company is throttling).
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