Streaming giant Netflix is increasing its prices in the US
The service increases the cost of its standard plan by $ 1 from $ 13 per month to $ 14 per month. The premium tier costs $ 2 more per month and increases from $ 16 per month to $ 18 per month. The basic plan of the service will remain at $ 9 per month.
The price increase for new Netflix subscribers will be in effect from Thursday. Current subscribers will be notified before their next billing cycle.
“We know that people have more entertainment options than ever before and we are committed to providing our members with an even better experience,” said a Netflix spokesman. “We’re updating our prices so we can continue to offer a wider variety of TV shows and films – in addition to our great fall lineup. As always, we offer a range of plans so people can pick a price that works best for their budget. “
Investors have pinned Netflix for price hikes in recent quarters as subscriber growth has spiked due to the impact of the pandemic on demand for home entertainment. Last week, the streamer reported a slowdown in growth after two consecutive quarters of above-expected subscriber growth. In the third quarter, Netflix had more than 195 million subscribers worldwide, including more than 73 million in the US and Canada. The company expects to have 200 million subscribers by the end of the year.
Netflix last hiked its prices in January 2019 and saw a similar increase of $ 1 to $ 2 in its plan tiers. Analysts have indicated that another price hike was overdue. Netflix has increased its spend on originals and was on track to spend an estimated $ 17 billion on programming this year.
The company’s executives have stated that price increases are required on a regular basis. Earlier this year, Netflix CFO Spencer Neumann said the company would eventually raise prices to keep customers happy with the programming of the service.
“We start with the consumer, start with achieving these members’ satisfaction and increasing viewer satisfaction over time, and we think that over time we can increase and advance what we believe to be a great cycle of virtues,” he said at Morgan Stanley Technology, Media and Telecommunications Conference.
During Netflix’s latest earnings call, Chief Operating Officer and Chief Product Officer Greg Peters also noted the “positive cycle” when answering a question about recent price increases in Canada and Australia.
“The core model that we have, and what we really believe to be our responsibility and our job, is to use the money our members give us each month as wisely and wisely as possible to create new amazing stories … in the Basically delivering more value to our members, better product experiences, ”said Peters. “And if we do this well … we will add more value to our members and we will return occasionally and ask those members to pay a little more to keep this virtuous cycle of investing and adding value going.”
But it also comes with Netflix facing more competitors than ever, including streamers HBO Max, Peacock, Disney +, and Hulu, all of whom are trying to win consumer paperbacks. HBO Max costs $ 15, Disney + $ 7 per month, and Hulu starts at $ 7 per month (or $ 12 per month without ads). NBCUniversal streamer Peacock, which had more than 22 million registrations this morning, is launching for free and costs up to $ 10 per month.