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If you had a subscription, you could have a Netflix disc indefinitely. You just couldn't rent any new movies/shows until you returned it.
If you cancelled your subscription and kept the disc, then yeah they hit you with a "higher than cost" fee.
And it was a pretty great deal when you watched a load of movies, like my family did. We were very early adopters. Queue over a hundred titles deep and it never shrank because we added as fast as they came.
Ohh yeah. A huge movie buff buddy of mine had the 8 disc plan and rigged up a multiburner pc. His mail was also dropped off in the morning.
Dude would get up, grab his 8 movies, get them burning, go to work and drop them off in the post box same day before pickup. He'd have new movies every couple of days. He built a hilariously large movie library in just a few months.
That good "early to no broadband" pirating.
Also unlike modern day streaming, they didn’t have to worry about obtaining the rights to the movies. They could just buy the DVD from any retailer.
So there were no platform exclusives to worry about.