Netflix subscribers in the United States are about to see a price increase in all subscription levels.
The service’s most popular plan will increase HD streaming from $ 11 to $ 13 per month. Netflix’s most fragile plan, which offers 4K content and four simultaneous streams on various devices, would be a $ 14 to $ 16% increase. And the service’s original plan, which does not offer HD, will increase from $ 8 to $ 9.
These prices will immediately impact all new customers, according to AP, according to current customers, to experience growth over the next three months.
Netflix CEO Reed Hastings has said in the past that incremental price increases will be needed as the company earns more money in the original series and licenses popular programming.
“Price is all relative to price,” Hastings said in late 2017, the last time American customers saw growth. “We are increasing the content offering and we are reflecting on seeing it worldwide.”
Original series and licensed content do not come cheap. Netflix reportedly spent $ 100 million on maintaining streaming rights to Friends, one of the streaming service’s most popular series, according to various reports.
The streaming service is also investing heavily in building its own exclusive library. It had around 700 original shows in 2018 alone and is expected to develop more this year.
Other streaming services such as Hulu – and new platforms such as Disney +, Warner Media, and NBC Universal’s recently announced service – begin to flood the landscape, with Netflix continuing to invest in original content and movies to keep customers interested.
Netflix currently has 58 million domestic subscribers, according to the company’s most recent investor meeting, with about 80 million international subscribers.
Developing a slate of foreign TV series and films, such as the Golden Globe-winning Roma, directed by Alfonso Quarone, is also a top priority for the company. Netflix has earned about $ 8 billion in long-term debt as of September 2018 – the cost of investing in original content so heavily and so quickly.
FX Networks President John Landgraf told a group of reporters in 2016 that Netflix’s rapid growth was uncertain.
Landgraf said, “I think if anyone in one company would be particularly bad, and I don’t care which company they are, if they seize 40 or 50 or 60 percent of the market share in creating the story Were able to, ”Landgraf said.