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08 October 2017, 01:06 | Gordon Grant
Netflix, Inc. (NFLX) Is Officially Raising Prices In The US
Netflix is squeezing a bit more out of its customers.
Netflix the online TV and film streaming service have raised their prices for its service in the United Kingdom and the U.S. for the first time in two years. Netflix still offers a subscription plan for $7.99 a month, but that only allows for streaming on one connected device at a time and doesn't support HD streaming.
This is Netflix's first price increase since 2014, and that particular fee hike was implemented slowly. The basic plan will remain unchanged at $7.99 a month.
The company says its strategy is to concentrate on getting bigger by acquiring more content and increasing its brand around the world rather than profits for the time being.
According to Mashable, Netflix is raising the price of its standard, two screens plan from $9.99 to $10.99.
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The spokesperson added that existing users will begin receiving notifications on October 19. New customers will pay the higher cost starting today. Netflix will be sending out an email to their current subscribers this month to alert them about the new, higher prices. In fact, in 2016 alone, the company spent $6 billion on over 600 hours of both original programming and acquisitions.
Where the Premium plan used to cost users £8.99 a month, it is now priced at £9.99 a month.
And despite the subscription rate increases, Netflix is still cheaper than cable.
So, if you want to avoid the price hike, don't mind watching in standard definition and don't have other people on the same account who want to watch at the same time, here's how you change your subscription plan.
"Assuming no churn, we estimate that a $1 / $2 increase could drive ~$650-700M in incremental revenue in '18. Further, we expect less speculation this time as to what the price increase means for future content spending given 2018 has already been indicated at +$1b Y/Y", wrote Mitchelson in a research note.
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