March 28, 2007

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  NEWS: Netflix Gift / Credit Card Brouhaha

  Netflix, the name almost synonymous with the home-delivery of DVD movies, has stirred controversy amongst consumers regarding its policy on gift subscriptions. As it turns out, consumers who have received Netflix gift cards for subscriptions must still provide a valid credit card number to move forward with their membership.
  
  Consumers are fuming over the concept of being required to furnish a card number, in light of having a gift card that theoretically provides prepaid membership. Netflix maintains a policy of automatically renewing a member's subscription using the card number on file. If a user has their subscription as a gift, or by using a gift card, they have to take the initiative to cancel their subscription before it automatically renews at the end of the prepaid period. Some users are crying foul, saying that not allowing a gift card holder to use the card's value without strings attached is tantamount to theft.
  
  Netflix defends the practice, stating that the policy of holding a consumer's credit card number on file has to do with the high cost of replacing lost and/or broken DVD movies. The card numbers are for use in such instances, says the company, and also for the consumer's convenience in not having to renew the policy manually at the end of the monthly subscription period, which could lead to an interruption in service. Consumers are free to cancel their gift subscriptions at the end of the period without cost or charge to their credit card, by initiating a phone call.
  
  Blockbuster, Hollywood Video, and other DVD rental chains use their lack of a credit card-on-file requirement as means to tout their in-store unlimited DVD rentals plans. Blockbuster also runs a service similar to Netflix, which offers home delivery along with in-store rental privileges.
  
  
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