Streaming shows and movies are about to get more expensive for more than 55 million Americans.
For the second time in two years, Netflix announced that it will be raising subscription prices in the United States, affecting an estimated 58 million customers.
Netflix’s basic standard definition plan is going up from $8 to $9 a month, its standard HD plan is going up from $11 to $13 a month, and its premium 4K plan is going up from $14 to $16 a month.
The basic plan lets users stream one show or movie on a single device at a time in standard definition; the standard plan allows users to stream up to two devices at the same time in high definition; and the premium plan allows users to stream to up to four devices at the same time in high definition and ultra high definition.
“We change pricing from time to time as we continue investing in great entertainment and improving the overall Netflix experience for the benefit of our members,” Netflix said in a statement. “Customers will be notified of the increase by email and through the Netflix app at least 30 days before the price hike takes effect; timing will vary depending on the customer’s billing cycle.”
The new price bump is the largest in the history of Netflix, which also increased subscription prices last year. It is the fourth time the streaming service has raised its prices since it launched 12 years ago. No specific date has been announced for the price jump, but it is reportedly expected to happen in the coming months.
According to reports, Netflix spent an estimated $13 billion in 2018 on original content, which, combined from increased competition from other streaming services, may have led to the increased subscription prices. Netflix reportedly outspent every major Hollywood studio last year and purchased its own production studio.
In comparison, Amazon offers streaming services as part of its Prime program for $13 a month and Hulu sells ad-free services for $12 monthly. Other streaming services are also available from CBS and soon, Disney.
While the increased monthly price may draw the ire of some customers, Netflix saw a dramatic jump in its stock this week following the announcement.
“This is a more aggressive move than (investors) were expecting,” Moody’s analyst Neil Begley stated. “It shows Netflix is pretty confident that it still has some pricing power in the United States.”
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