Unfortunately, Netflix' physical rental catalog is shrinking significantly as well. I assume they've just stopped refreshing much of their back catalog.

I generally agree that the fragmentation is a PITA. It would be nice to have an all-you-can-eat subscription for any content that's available digitally. Of course, then people will complain that their now bundled subscription offering costs $100/month and they can't just consume a la carte.

The analogy to cable bundles isn't perfect but it's similar in some respects. People don't really mind that they have maximum choice. They just want a cheaper price because they don't personally consume all the options on offer.