The five-year deal, rumored to be worth about $1 billion, gives viewers access to movies produced by Paramount, MGM, and Lionsgate. As a result of the expanded selection, the prices of Netflix plans with streaming video and DVD mail rentals went up, but not by much. Two of the basic plans increased by $1 a month. However, a little increase can go a long way. If on average, each subscriber is paying $1 more, in five years that will amount to $960 million in additional revenue to Netflix, virtually paying off the acquisition of the online rights. When the pluses and minuses are reconciled, the result is a net gain for the consumer – the 16 million Netflix subscribers get a huge return on their small investment in the form of thousands of additional film choices from the libraries of these leading production companies.
Netflix, Inc./PRNewsFoto/AP/File
