Netflix recently announced that it was jacking up its prices 60% to its existing customers, which — surprise! surprise! — caused nearly every Netflix customer with a Twitter or Facebook to bitch, moan, and complain about it on their social network of choice.
I have a message for Netflix customers: Quit your effing whining.
Netflix was well justified in doing what it did. Here’s why:
1. The CEO took a pay cut in 2010 and has to make it back. In 2009, Reed Hastings made $1 million in salary. In 2010, his salary was cut to a little more than $500k, which is where it stands for 2011. How the hell can he be a titan of industry if he isn’t making a mill per year? He can’t. You have to pay for that, Netflix customers. Sorry.
2. It’s the right thing to do for the country. Netflix’ provision for income taxes in 2010 was 5% of revenue, which came in about $2.1 billion. In other words, it paid out more than $100 million in taxes. If Netflix’s revenue jumps 60% as a result of its price increase — to more than $3.5 billion — than it will pay out roughly $173 million in taxes this year. And that’s good for America, folks.
3. You deserve to pay. If your lazy ass is sitting around watching all those DVDs every day, then you should have to pay for that privilege.
Netflix should have raised its prices by 70%. Enduring a little criticism on Facebook is a small price to pay for making this country a better place.