Netflix is raising subscription prices in the us and parts of Europe as the leading online streaming service invests in more shows and features, the company said Thursday. If Netflix ups its price by £1 every 6-12 months then it might start seeing something of a backlash. This isn't the first time Netflix has increased its prices and it certainly won't be the last. This, however, is much more important for current Netflix subscribers.
The price increase for new customers in the USA became effective on Thursday.
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Shares of the Silicon Valley-based company jumped more than four percent to $192.44 in trading following news of the relatively small price hike.
The spokesperson added that existing users will begin receiving notifications on October 19.
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Netflix announced Thursday it is raising the prices of some of its subscription packages for US, UK and some other European subscribers. Fortunately, the basic plan is still $7.99/month, so that is still fully covered by T-Mobile, for those that are okay with standard definition video and one stream at a time from Netflix.
The entertainment giant has increased the price on two of the three subscription tiers offered to its 52 million USA subscribers. Netflix has more than 53 million US subscribers to the plan, which includes HD streaming and allows programs to be viewed simultaneously on two different internet-connected devices.
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The online media business ended the USA trading day around 5% higher Thursday, which brings the year-to-date gain of the company's stock price above the 50% mark. "We think that Netflix is destined to be a cash-burning, high-growth company until it changes its strategy and accepts its fate as a highly profitable slow-growth company". Canadian subscribers experienced a subscription price hike earlier this year.