Some Thoughts on Netflix’s DVD service

Yesterday, Netflix announced that they’re shutting down their DVD rental service, after 25 years of operation.

I rented my first DVD from Netflix in 2005. Daisies, a 1966 Czech New Wave film. It was recommended to me as an interesting bit of film history, and I wasn’t sure where to get it. In the years prior to my signing up, Netflix had gone back and forth a few times as to whether their catalog was browsable by the non-member public. Once it was available again, I checked for Daisies, treating this fairly obscure film as my test of their catalog overall. Sure enough, there it was, just waiting for me. I signed up, requested the DVD, and it showed up a few days later. I quickly had a hundred movies in my queue.

Daisies was entertaining. Very weird.

A Station Wagon Full of DVDs

I live in a rural community in Northwest Oregon. The best internet service I can get is 7Mb/s¹ - and this is a lot better than some of my neighbors have access to. The last time I did a proper test, the time from putting a DVD in my mailbox and getting a new one averaged just about 3 days. At their peak (and when I lived closer to a city) it was lower, but that still feels pretty good, given that they’re mailing physical disks around, processing their returns, and sending you out a new one.

There are a few different DVD formats, but the most common for studio releases is DVD-9, which tops out at 8.54GB. Most releases don’t use all that space, but use a good chunk of it. We’ll treat 7GB as an average². 7GB is 56Gb, meaning it’d take about 2¼ hours to download that movie.

The most generous DVD plan Netflix offers standard³ is 3 disks out at a time with unlimited exchanges. With a 3 day turnaround number from earlier, that means you can get about 6 disks in a week. That’s 42GB a week, or just about 70kbps if you average it out. That bandwidth isn’t up to even my meager DSL line, but a lot better than dial-up, even if you managed to keep it going 24/7.

I’ve always stayed on Netflix’s DVD plan, rather than moving to one of their Blu-ray options, because of how I watch things on physical media at home. But that would produce an even stronger case for IP-over-USPS⁴. Commercial Blu-ray releases typically run over 20GB. That’s about 3x the average DVD release, or about 2.1MB/s if you average it out. A lot of my county can’t get a DSL line that’ll do that.

This is a Failure?

After hearing about the shutdown in a Fediverse post, the first long-form thing I read about the shutdown was an NPR piece. One thing in particular stood out:

The DVD service generated $145.7 million in revenue last year, which translated into somewhere between 1.1 million and 1.3 million subscribers, based on the average prices paid by customers.

I understand that Netflix’s overall subscriber base is about 200x that, and their overall revenue about 56x that, but it remains baffling to me that a business serving over a million customers and generating over $145M a year is just too small to bother with.

Also: is it me or do these numbers mean DVD subscribers were generating slightly more revenue per subscriber than Netflix’s average?

The End

In the last year or so, I’ve seen Netflix’s DVD catalog shrinking, both in terms of things previously in their catalog becoming unavailable and in how often I see a “short wait” warning (which I assumed to be largely about how many of copies of things they’re stocking, although I hear they’ve been reducing distribution centers, too). It’s been clear for years that Netflix’s attention was — sensibly — elsewhere.

Even so, their DVD catalog is almost certainly the largest single catalog you can sing up for today, and for lots of people in limited bandwidth situations it’s the only good option. I’ll miss it. There aren’t a lot of services I’ve subscribed to for 18 years⁵.

Daisies is no longer available on Netflix. It is available to stream via HBO Max or to buy or rent via Apple TV.