From the Netflix blog:

The default setting will enable you to stream about 3 hours of TV shows and movies per gigabyte of data. In terms of bitrates, that currently amounts to about 600 Kilobits per second. Our testing found that, on cellular networks, this setting balances good video quality with lower data usage to help avoid exceeding data caps and incurring overage fees. If you have a mobile data plan with a higher data cap, you can adjust this setting to stream at higher bitrates.

In a nutshell, you can now change the quality to:

• Off (don’t use cellular data, meant for WiFi)
• Low (4 hours per GB)
• Medium (2 hours per GB)
• High (1 hour per GB)
• Unlimited (use cellular, meant for unlimited data plan)

To get to this setting, launch the Netflix iOS app, click the hamburger menu (upper left corner), scroll down the sidebar and tap App Settings.

Terrific new setting.