On Thursday, Netflix announced that they would be raising their subscription prices for the first time in 2 years, reports The New York Times. This is one of the several announcements for the streaming titan this year, including the delay of "The Punisher" in the wake of the tragic shooting in Las Vegas. This is a big announcement, but what does it mean for Netflix going forward, given they announced it would affect most subscribers in the United States?
Subscription plan increases
The most popular Netflix plan allows customers to stream on two screens at
once.
It currently costs $9.99 a month but will see an increase of $1 up to $10.99 a month. The premium plan that allows customers to stream shows on four screens at one time costs $11.99 a month and will see a slightly larger $2 increase to $13.99 a month. However, Netflix's basic plan that streams to a single screen at a time will maintain its current price of $7.99.
There was no mention of an increase in the price of plans that include DVDs. The New York Times reports that current subscribers will receive a notification on October 19 to alert them of the price increase and be given thirty days to either keep their current plan, change subscriptions, or delete their account.
Could this be due to Netflix's original content?
Recode has a very handy graph that displays the amount of money several streaming services have spent on content this year, including Netflix, Hulu, and Amazon. Netflix has spent $6 billion on content this year, far more than its competitors. Back in August, Netflix CEO Ted Sarandos told Variety that the company's spending on content would be closer to $7 billion - an increase of $1 billion from this year.
This will help Netflix compete better in the streaming business, especially since Disney will be ripping its movies away in 2019 to create their own streaming service. Netflix has found great success in its Original Content, including shows such as "House of Cards" and "Stranger Things," meaning that pouring more money into their content will likely take them to even greater heights.
How will this affect Netflix going forward?
It seems likely that we'll see an outpouring of content from Netflix from here on out. They've created many great original shows and have access to tons of other great shows and movies. Even once they lose their Disney movies, it's likely that their original content will let them keep going strong. While they are increasing prices, it's likely many people will stick with their plans - after all, what's an extra dollar or two a month for something like Netflix? Personally, I look forward to seeing what they can create with the extra money.
