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Is Netflix Streaming a Good Deal?

My wife and I use Netflix‘s streaming service as one of the pillars that holds up our cable-free entertainment setup. It was also the main reason I started subscribing to a XBox Live Gold membership, though that comes with some other benefits which I always forget about until the moment I notice them.

The XBox isn’t the only device that lets you stream Netflix movies, of course, but it’s the one we use, and it’s the only one I’ve tested. The picture quality is as good as anything else that comes through the 720p projector.

We got the 1-DVD-at-a-time plan, figuring we’d mostly be using the streaming service. What we didn’t expect was that the first physical DVD they sent us would sit untouched on the counter for months before we finally sent it back, unwatched. The selection is great, provided you want more than just the latest hit movie, and at first glance, $8.99 per month seems like a good deal.

But I love data, so I started to wonder: is it actually a good deal? Fortunately, Netflix is forthcoming with data about your viewing habits. You find data on all of the videos you’ve streamed to your devices, including dates and how much of each one you watched. In the first 90 days of the year, we watched something through Netflix on 42 of those days, spending almost 13 hours enjoying (or just barely enjoying) some movie or TV show.

If you add up $8.99 for those three months, plus three months’ worth of the XBox Live Gold membership, that’s $40.47. Over thirteen hours, it works out to $3.11 a hour. It’s cheaper than going out to a movie, certainly, especially considering there are two of us in the house.

I will admit that it’s more expensive than using the Redbox, but we’ve tried using the Redbox, and when it’s not broken, it’s empty, or there’s a long line, and regardless, you have to drive to it. I think Netflix wins, hands down.

Updated June 23, 2016 and originally published April 20, 2010.

About the author

Smithee formerly lived primarily on credit cards and the good will of his friends. He is a newbie to personal finance but quickly learning from his past mistakes. You can follow him on Twitter, where his user name is @SmitheeConsumer. View all articles by .

{ 18 comments… read them below or add one }

avatar 1 Anonymous

I have to disagree with your math. I bought a one year xbox live subscription about 3 months ago for $35. Then I realized that I won’t be using it all at and sold it last week for $40 on eBay. So for a year’s worth it would be well under $3 an hour. And for anyone who watches more than 2 movies a month (which you do not), the price plummets. At 3 movies a month the price drops all the way to about $2 an hour. The more you watch the better deal you get.

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avatar 2 Anonymous

If you really want to crunch the numbers to see if you’re getting your money’s worth, try Feedfliks ( This free site connects to your Netflix account and, among other things, breaks out how much you’re spending per movie. Quite enlightening.

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avatar 3 Anonymous

I love netflix streaming. I’m currently overseas, and I can view uncensored films (I live in a conservative Muslim country). I’m so glad I have it!

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avatar 4 Anonymous

Fox just released a bunch of new TV titles to stream instantly, X-Files and Buffy the Vampire Slayer to name two. Plus they have a bunch of Doctor Who. Netflix streaming is definitely worth it in my household.

After we ditched full cable the one thing I missed was live sports. We only get 11 channels now (the major US networks), but luckily one of the extras is the Canadian channel CBC, the hockey coverage is great! I think they are they same games that I was getting on Versus.

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avatar 5 Anonymous

If you have a Wii, you can get the disk and there is no extra charge like with XBox. We just got our disc and I do have to say I was pretty disappointed with the picture quality. I had a better picture by simply hooking up my laptop via VGA to my 40″ LCD HDTV. The selection isn’t great for streaming, but it isn’t horrible either.

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avatar 6 Anonymous

I love streaming video. We have Xbox Live anyway, since my husband games. But it’s also significantly cheaper if you just buy a one-year membership for Xbox Live. (I think it’s something like 60-70.) Also, of course, you can use reward programs to get Amazon or GameStop GCs and buy the Xbox Live for free. That helps too!

But it’s great to have movies available at any time. It’s sometimes frustrating, though, when only part of a series is available online, while the rest is in DVD format.

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avatar 7 Anonymous

My wife and I don’t stream much — but we use Netflix in place of cable. We’re big fans of watching TV series that have made it to DVD — and truthfully, it is much more enjoyable to watch an entire season back-to-back than it is to even TiVo it or whatever.

We had the 3 at-a-time plan and used Redbox when our disks were in the mail. I never had anhy real issues with the lines or any particular box being empty — I almost always reserve a disk via the website, and it tells me which kiosks it’s available at, which is nice. But the problem I had that turned me away from Redbox was not an empty kiosk, but a full kiosk. If it’s full, you can’t get your disk in, and if it’s 8:55pm, it’s not like you can make it to the next kiosk in time, either.

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avatar 8 Anonymous

When I’m working on a overnight consulting projects (web programming) I put movies on to keep me company and keep me alert.

I probably stream 4-5 movies a week doing this. It’s certainly better than whatever is on TV at 2 AM.

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avatar 9 Anonymous

What kind of download speed does one rquire for streaming?

I just got cable modem, and at best it’s at 12mbs, but usually around 6mps depending where I am in the house. Goes down to 3mbs the farther away I am.

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avatar 10 Anonymous

I use Netflix streaming a LOT. There are several seasons worth of TV shows I have watched on it, including Season 1 & 2 of Thirtysomething, and the last couple of seasons of Desperate Housewives. I have a Roku box on my 15″ TV in the kitchen, and I watch the shows while I cook. In the past I would have purchased the DVDs. Netflix is much cheaper, and there is no clutter.

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avatar 11 Anonymous

I think as long as you are above 3mb connections it should buffer fine without a lot of chopping.

I ran the feedflicks deal above and it said my cost for streaming was 16 cents per show. Which means we watch a lot. But most nights my kids will stream a few at the same time my wife is in the middle of a Dead Like Me streaming marathon. So I think it’s a good deal for our family.

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avatar 12 Anonymous

We watch a lot of TV/movies through netflix streaming, so for us it’s a good deal. Plus, we bought a reduced price 1 year xbox live gold membership for around $35 bucks online, so it’s pretty affordable for that – and we would have had it anyway since I like to game very once in a while. We also use a software called Playon that allows us to stream a ton of video content from hulu and a ton of other video content providers online. If it weren’t for sports content I’d cancel cable altogether and have an extremely frugal TV setup.

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avatar 13 Anonymous

Thanks for the link!
My watch instantly works out to 65 cents a movie according to feedfliks. My calculations have it at 55 cents an hour!

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avatar 14 Anonymous

Netflix streaming (we just started doing it using our Wii) is an amazing deal, and a brilliant substitute for TV if your habits don’t call for the latest TV shows.

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avatar 15 Anonymous

28 cents a movie – bam! We stream a lot since our media center is a computer hooked up to our TV. And I have a dual monitor set up at the office, so I like to put on some TV shows to stream in the background while I work there.

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avatar 16 Anonymous

The last time I checked out streaming was last summer (I cancel netflix and bring it back every summer when there is nothing new on) the streaming selections were HORRIBLE. Has this changed? I mean the movies that were streaming were old and just not good; and they barely had any tv series streaming.

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avatar 17 Anonymous

There are a lot more options on the streaming now than there were last year – especially for TV series, however, the movie options are still a bit lackluster with mostly older movies, B movies, etc. Still, we can almost always find something to watch and they’re always adding new stuff.

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avatar 18 Anonymous

I use Netflix streaming both on a PC hooked to our big screen TV and also now via a Wii. It works great and the video quality is very good. The selection of movies & TV shows available on streaming is limited but there is a lot of good stuff that I enjoy. I don’t think I’d pay for Netflix for the steaming alone, but its a great additional benefit for the service.

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