While the U.S. Postal Service is planning to reduce its six day delivery schedule to just five delivery days, in effect removing Saturday mail delivery, Netflix does not appear to be the least bit concerned. In fact, the removal of Saturday delivery could actually help them in the long run. Why? Because with consumers not having access to their DVD’s on Saturday via the mail, they may opt to sign up for the digital streaming service–or so analysts believe, and Netflix is hoping.
There would, however, be some customers who would be greatly affected by this. Rural customers would be the first ones to feel the pinch, especially those who do not have access to high-speed broadband internet connections. The removal of Saturday mail service could actually play well into the hands of Redbox, the Coinstar owned DVD-vending-machine company that has thousands of locations across the United States, including rural areas.
Another concern is for those customers who find themselves trying to get the most bang for their buck and get as many DVD’s as they can per month. For these consumers the removal of Saturday delivery would definitely hurt the value they see in the Netflix service, however many analysts agree that these type of customers are few and far between.
Netflix began this year (2013) with just 8.2 million DVD by mail subscribers and when compared to the whopping 27.1 digital subscribers Netflix is probably won’t be feeling much pressure if the Postal Service decides to cut Saturday delivery. Investors also didn’t seem to mind, as Netflix’s stock gain nearly 6 percent after Wednesday’s announcement.