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Netflix ups fees for Blu-Ray rentals

3/30/2009

Los Gatos, Calif. Netflix is raising its prices for Blu-Ray discs in a change that will triple or quadruple the high-definition surcharge on Netflix's most popular subscription plans.

The new rates announced Monday are being driven by the growing demand for the Blu-Ray format among Netflix's more than 10 million subscribers.

About 1 million of the subscribers are requesting Blu-Ray discs instead of standard DVDs, and Blu-Ray discs cost about 30% more. That means Netflix's profit margins are being squeezed as it expands its high-definition inventory.

The company had been imposing a $1 monthly surcharge for Blu-Ray rentals since September, regardless of how much the basic subscription plan costs.

Effective April 27, Netflix will adopt a sliding scale that will slap higher Blu-Ray fees on plans that enable customers to check out multiple DVDs at a time. All monthly fees will remain the same for customers who exclusively rent standard DVDs.

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