Economy

Netflix raises prices 10%

Netflix raises prices 10%”

Netflix is raising its subscription prices, again. USA Today reports that Netflix is raising prices for the first time in two years.

Now, the company seems to be joining the likes of many other industries-wireless, cable, even Starbucks-in making price bumps a more-or-less annual thing.

As for when subscribers can expect to see the new prices reflected on their monthly bill, Netflix plans to begin notifying existing members of the impending increase on October 19, and will send these notices out at least 30 days prior to each user's next billing date.

Netflix on Thursday said it is bumping up subscription prices in the U.S. and parts of Europe as the leading online streaming service invests in more shows and features.

According to WTAE-TV, Netflix will now charge $11 per month instead of $10 for the plan that includes HD and allows people to simultaneously watch programs on two different internet-connected devices. Meanwhile, the four-stream family plan now costs $13.99 per month instead of $11.99 per month. The basic plan will remain at $7.99.

The higher pricing comes as the video streaming service spends heavily on original content and expanding outside the U.S.

Commenting on stock performance, Rob Sanderson analyst at MKM Partners said, "Most investors believe that Netflix is priced well below its value to consumers and want to see the management continue to increase monetization". The company expects to spend almost $7 billion on content for its service next year, including movies, TV series and comedy specials.

Netflix said in July it has 104 million subscribers globally, while revenues rose 32% in the second quarter to $2.8bn.



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