I don't think they've cut costs at all. I pay them $9 a month now or whatever. I didn't spend $9 a month at Blockbuster before they existed, and I don't watch very many more movies now than I did then. Might even be less.
I do it because it's very convenient, not because it's a way to save money. I'll probably switch to DVD only from them now and actually start using whatever free streaming Amazon gives me via prime. The streaming selection sucks anyway, I probably watch more on Blu-Ray or stuff I torrent.
If you count 'movies I bought' + 'movies I rented from Blockbuster' they have cut costs for me. I didn't buy or rent many.
But that's not what it's really about. If you cancel your cable and get Netflix, you are saving bundles of money. I know more than a few people doing that, and I am so freaking close to it I'm not sure why I waste the money on TV anymore other than for ESPN & live sports. If not for that, I'd be long gone.
Depending on your ISP, you may have access to espn3.com. Most major sports leagues also offer online streaming packages for something like $100 for a whole season. They don't get you 100% coverage (due to local blackouts, games on TNT or other networks, etc.) but they get you pretty close.
I do it because it's very convenient, not because it's a way to save money. I'll probably switch to DVD only from them now and actually start using whatever free streaming Amazon gives me via prime. The streaming selection sucks anyway, I probably watch more on Blu-Ray or stuff I torrent.