Final answer:
True, Netflix's initial revenue model was a flat-rate monthly subscription, not a per-disc rental fee. In 2011, they separated DVD rental from streaming, resulting in a 60% price hike. In 2014, subscription prices increased for streaming and 4K content.
Step-by-step explanation:
The initial revenue model of Netflix was based on a flat-rate monthly subscription fee rather than a per-disc rental fee. This statement is true. Initially, customers could pay a monthly fee to get DVDs by mail, which later evolved into a streaming service. This model allowed unlimited rentals without the need to pay for each individual DVD rental.
In early 2011, before they faced a 60% price hike to retain the same service, Netflix consumers paid about $10 a month for a package consisting of streaming video and DVD rentals. However, in July 2011, Netflix announced a packaging change that would charge customers wishing to keep both streaming video and DVD rental about $15.98 per month, which was a significant price increase.
Moreover, in 2014, Netflix raised its subscription price for new U.S. customers from $7.99 to $8.99 per month for streaming video. The price for accessing 4K streaming content also went up from $9.00 to $12.00 that same year.