Netflix today raised the price of its standard plan from $12.99 a month to $13.99 a month, and its premium plan from $15.99 a month to $17.99 a month.
The prices are effective immediately for new customers and will rollout in the coming weeks to existing subscribers. This is the first price hike from Netflix since January 2019.
Netflix’s premium plan, which includes 4K programming and four simultaneous streams, rose from $13.99 a month to $15.99 a month in January 2019 while the streamer’s standard plan, which includes two streams and high-def programming (but no 4K), increased then from $10.99 a month to $12.99 a month.
Today’s price increase will create a new challenge for Netflix which is under increasing competition from such new powerful rivals as Comcast (Peacock), Disney (Disney+) and AT&T (HBO Max) as well as long-time foes, Hulu (also owned by Disney) and Prime Video (Amazon).
Several of Netflix’s competitors are offering lower prices and expanding libraries. For instance, Peacock, which is owned by NBC, offers more than 15,000 hours of programming for free while its ad-included $4.99-a-month plan has more than 20,000 hours. Disney Plus, which carries the extensive Disney movie catalog and new shows such as Hamilton and Mandalorian, is available for just $6;.99 a month.
However, the Netflix fee hike was foreshadowed by at least one financial analyst, Alex Giaimo of Jefferies. He issued a note to his clients last month that suggested Netflix was contemplating a near-term increase. Of course, considering that it’s been 20 months since Netflix’s last rate increase, it was not a wild forecast.
“After a change in language regarding pricing on the (Netflix’s second-quarter telephone call with analysts) call, we believe a potential hike is probable in the near to midterm,” Giaimo said, according to Investors.com. “In Q1, Netflix said that they were ‘not even thinking about price increases.”
Netflix’s basic plan, which includes standard-definition video, remains at $8.99 a month.
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