Netflix announced today that, after seeing success with a rise in subscription cost in Ireland, the company plans to raise prices by as much as $2 for new customers, depending on the customer’s location.
As expected we saw limited impact from our January price increase for new members in Ireland (from €6.99 to €7.99), which included grandfathering all existing members at €6.99 for two years. In the U.S. we have greatly improved our content selection since we introduced our streaming plan in 2010 at $7.99 per month. Our current view is to do a one or two dollar increase, depending on the country, later this quarter for new members only.
However, current subscribers aren’t safe from a subscription price increase:
Existing members would stay at current pricing (e.g. $7.99 in the U.S.) for a generous time period. These changes will enable us to acquire more content and deliver an even better streaming experience.
I personally have no doubt that Netflix’s recent deal with Comcast has a lot to do with the upcoming price increase. Netflix has to come up with the money somehow to pay Comcast for faster access to the Internet service provider’s subscribers. And like any business, that cost is passed onto the consumer.
How do you feel about this? Right now Netflix costs $7.99 a month for its streaming service. Would you pay $8.99 or $9.99 a month for the same service?