Cartoon: Peter Clarke

This movie’s getting panned, big time.

Netflix is enduring a world of hate for its price hike, which ups the cost for a combined DVD-rental and streaming plan by 60 percent. Customers and the media are having a field day taking the company to task for requiring customers to pay $6 more a month for the same, exact service.

Rival Blockbuster is loving it. The struggling video rental chain is touting its 99-cent DVD rentals for thousands of titles, and also highlights its $2.99 rentals for new releases. (But the real question when renting from Blockbuster is: If the store shuts down during the 24-hour rental period, do you get to keep the movie?)

Netflix invented the postal-mail DVD business, and its red envelopes are iconic. But the company has been steadily nudging customers to streaming, which saves huge costs associated with making, storing and shipping physical media. And people do love streaming for the instant gratification that comes from finding a movie to watch now rather than waiting days for a disk to arrive in the mail. But the Netflix catalogue of streaming movies is tiny by comparison — 20,000 versus 120,000 discs.

Netflix created an unlimited streaming plan for $8 plan last November. If you also wanted unlimited DVD rentals, you tacked on $2 more. Now Netflix wants to charge $8 for the DVD plan — as much as for streaming.

Usually when a company raises prices they do so apologetically, anticipating customer anger. The company blames the increasing costs of everything. It hints that they are doing everything possible to keep prices low, in a sort of “If we weren’t so awesome, this bad news would be even worse.”

Netflix had another idea, which amounted to a sort of “We’re leaving too much money on the table.”

Here is how Netflix put it:

“Last November when we launched our $7.99 unlimited streaming plan, DVDs by mail was treated as a $2 add on to our unlimited streaming plan. At the time, we didn’t anticipate offering DVD-only plans. Since then we have realized that there is still a very large continuing demand for DVDs both from our existing members as well as nonmembers. Given the long life we think DVDs by mail will have, treating DVDs as a $2 add on to our unlimited streaming plan neither makes great financial sense nor satisfies people who just want DVDs.”

What could possibly go wrong?

The #Netflix hashtag on Twitter is a source of near-unanimous animosity toward the video rental company. TheBrothaMan tweets, “Dear #Netflix, You made a terrible business move to increase the prices. Shame on you! Signed, Loyal Subscriber.” Thousands of others echo his complaint on the original Netflix blog post announcing the changes, which now sports over 10,000 — mostly angry — comments. Many members vow to cancel their subscriptions.

Journalists couldn’t restrain themselves from sniping at Netflix, either. A TechCrunch blogger immediately canceled his DVD membership and thanked DVD rental service RedBox for filling the gap. The Adirondack Almanack tweeted, “Dear #netflix, You can’t double the price of a product without providing more value. Bad business move – #redbox here we come.” One Houston Press blog post simply reads, “Hey Netflix – WTF?” In summation: Charging more for fewer films isn’t the best way to satisfy customers.

It’s not as if Netflix was struggling — profits were up 88 percent in the first quarter and, at the time of writing, the stock is up 66 percent in 2011. It’s also one of those companies whose customers really seem to like it. With its DVD price hike, Netflix seems to have wiped out a bunch of good will in one fell swoop.