Netflix Throttling - Page 6

Alex · 02-18-2006, 09:24 AM

Standard bulk mail is the equivelant of third class mail. But standard bulk mail requires that every item shipped be identical (not identical in shape and weight but also in content except for personalization of names based on recipient - so you can't use standard bulk mail to send out 500 cable bills).

Since Netflix's contents are not identical they have to use presorted first class bulk mail if they want discounted postage. That has the same delivery time commitments as regular first class. They just get discounts by doing some of the work for the USPS (barcodes on the envelopes, presorted by zip code, etc.).

So if you can reliably get first class USPS mail then you should be fine with Netflix. It doesn't look like they are running any special referer offers (usually one free month on the three-at-a-time plan) but if it is a while before you decide to take the plunge you should check on that first.

Drince88 · 02-19-2006, 06:54 AM

Thanks, Alex!
It'll probably be a bit - I have to decide if I'd really actually watch the movies at all. The 'reliablility' of my first class mail aside (I just got something on the 18th that was postmarked the 10th, from Midland, TX), I just started thinking about this, so it'll be a while before I make the plunge.

Kevy Baby · 02-19-2006, 09:42 AM

Further boring you with how the USPS works and the costs that Netflix deals with:

Alex is correct that due to Postal regulations, they cannot be sending these via Standard (bulk) rates. Also, the delivey timing of Standard Mail (much slower than First Class, even with BMC drop shipments) would REALLY have Netflix customers up in arms!.

Netflix is getting some level of automation Postage discounts. However, they are still paying somewhere in the neighborhood of 30-31 cents per single disk mailed (I'm pretty sure that a single disk would remain under 1 oz.). Don't forget that the postage cost of the return (using Business Reply Mail - the service where the returnee does not have to put a stamp on the return piece) is 36.6¢ each*.

The round trip postage is approximately 67¢ for each disk. If someone is renting 20 disks per month, that is $13.40 per month in Postage costs alone. That doesn't leave a whole lot of room for Netflix to make any money.

As far as timing, the USPS will tell you they have 7-10 days to deliver First Class mail. However, the national average for First Class delivery into homes with Automation is 3-5 days (assuming Coast-to-Coast - if I remember correctly, Netflix mails out of Northern California). If you live in a larger metropolitan area, you typically will see quicker delivery than if you live in some podunk area such as East Washington. Yes, you will see the exceptions (I would predict that the 7-day delivery that Drince references was probably a hand-addressed, non-aotomated letter), but they are fairly consistent in their timing; weather delays aside.

* I am assuming High Volume QBRM rates.

Kevy Baby · 02-19-2006, 09:49 AM

While not the subject of the OP, I thought this story tied in.

Missing Netflix? The mailman did it!

Ghoulish Delight · 02-19-2006, 10:05 AM

Quote:

Originally Posted by Kevy Baby

(assuming Coast-to-Coast - if I remember correctly, Netflix mails out of Northern California).

Actually, Netflix has local distribution centers around the country. For instance, our return enevelopes are addressed to "Nearest Netflix Shipping Facility" in Santa Ana.

Kevy Baby · 02-19-2006, 10:55 AM

Quote:

Originally Posted by Ghoulish Delight

Actually, Netflix has local distribution centers around the country. For instance, our return enevelopes are addressed to "Nearest Netflix Shipping Facility" in Santa Ana.

Yeah, I should have looked that up. There are actually 37 according to the Netflix site. That's actually pretty impressive considering there really isn't any cost savings for Netflixt to do this (from a postage/shipping perspective).

One item to note: while Netflix advertises a one-business day delivery, that is from when they ship to arrival into your home. However, I am presuming that they do not ship until they get the previous one back. While I am sure that they have worked with the local Post Offices to expedite returns as best they can, return mail can take a day or two. Add another day for Netflix internal processing, and the turn-around time can add up.

When we tried Netflix a few years ago, they allowed you to log in to tell them you have shipped a disk back; they wouldn't wait to actually receive the disk before sending your next selection. I'm guessing that they don't do that any more.

Ghoulish Delight · 02-19-2006, 11:01 AM

Quote:

Originally Posted by Kevy Baby

Add another day for Netflix internal processing, and the turn-around time can add up.

If you're in an area with efficient service (as we are), this is what the turnaround looks like:

Put your return envelope in the mail Monday, received by Netflix Tuesday, Netflix ships your next DVD on Tuesday, you receive it Wednesday.

Since we started service again last year, it's only taken longer than that once or twice, and in those cases it came only one day after that. If you've got 3 DVDs out and stagger your returns, you can very easily get a nice steady flow of DVDs to watch.

Moonliner · 02-19-2006, 11:19 AM

I ran across a site called "Moviebeam" it's a Netflix like service that "beams" regular and some High-Def movies into a set-top box. You pay between $1.99 and $4.99 for each movie you watch. Could be a good way to get some new release HD content.

02-18-2006, 09:24 AM	#51
Alex . Join Date: Feb 2005 Posts: 13,354	Standard bulk mail is the equivelant of third class mail. But standard bulk mail requires that every item shipped be identical (not identical in shape and weight but also in content except for personalization of names based on recipient - so you can't use standard bulk mail to send out 500 cable bills). Since Netflix's contents are not identical they have to use presorted first class bulk mail if they want discounted postage. That has the same delivery time commitments as regular first class. They just get discounts by doing some of the work for the USPS (barcodes on the envelopes, presorted by zip code, etc.). So if you can reliably get first class USPS mail then you should be fine with Netflix. It doesn't look like they are running any special referer offers (usually one free month on the three-at-a-time plan) but if it is a while before you decide to take the plunge you should check on that first.
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02-19-2006, 06:54 AM	#52
Drince88 Senior Member Join Date: May 2005 Posts: 481	Thanks, Alex! It'll probably be a bit - I have to decide if I'd really actually watch the movies at all. The 'reliablility' of my first class mail aside (I just got something on the 18th that was postmarked the 10th, from Midland, TX), I just started thinking about this, so it'll be a while before I make the plunge.
	Submit to Quotes

02-19-2006, 09:42 AM	#53
Kevy Baby Chowder Head Join Date: Jan 2005 Location: Yes Posts: 18,500	Further boring you with how the USPS works and the costs that Netflix deals with: Alex is correct that due to Postal regulations, they cannot be sending these via Standard (bulk) rates. Also, the delivey timing of Standard Mail (much slower than First Class, even with BMC drop shipments) would REALLY have Netflix customers up in arms!. Netflix is getting some level of automation Postage discounts. However, they are still paying somewhere in the neighborhood of 30-31 cents per single disk mailed (I'm pretty sure that a single disk would remain under 1 oz.). Don't forget that the postage cost of the return (using Business Reply Mail - the service where the returnee does not have to put a stamp on the return piece) is 36.6¢ each. The round trip postage is approximately 67¢ for each disk. If someone is renting 20 disks per month, that is $13.40 per month in Postage costs alone. That doesn't leave a whole lot of room for Netflix to make any money. As far as timing, the USPS will tell you they have 7-10 days to deliver First Class mail. However, the national average for First Class delivery into homes with Automation is 3-5 days (assuming Coast-to-Coast - if I remember correctly, Netflix mails out of Northern California). If you live in a larger metropolitan area, you typically will see quicker delivery than if you live in some podunk area such as East Washington. Yes, you will see the exceptions (I would predict that the 7-day delivery that Drince references was probably a hand-addressed, non-aotomated letter), but they are fairly consistent in their timing; weather delays aside. I am assuming High Volume QBRM rates. __________________ The thing about quotes on the internet is that you cannot verify their validity. - Abraham Lincoln
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02-19-2006, 09:49 AM	#54
Kevy Baby Chowder Head Join Date: Jan 2005 Location: Yes Posts: 18,500	While not the subject of the OP, I thought this story tied in. Missing Netflix? The mailman did it! __________________ The thing about quotes on the internet is that you cannot verify their validity. - Abraham Lincoln
	Submit to Quotes

02-19-2006, 11:19 AM	#58
Moonliner 8/30/14 - Disneyland -10k or Bust. Join Date: Jan 2005 Posts: 9,022	Yet another option... I ran across a site called "Moviebeam" it's a Netflix like service that "beams" regular and some High-Def movies into a set-top box. You pay between $1.99 and $4.99 for each movie you watch. Could be a good way to get some new release HD content. __________________ - Taking it one step at a time.
	Submit to Quotes