Netflix announced it will be making big price increases for all three of the company’s plans in a move that saw it’s stock price spike by 6%.
Netflix’s standard plan which currently costs $11 per month will be increased by 18% to $13 per month.
The $8 plan will see its price increase to $9, and the $14 plan will increase to $16 a month.
These prices changes will go into effect immediately for new members and will be applied to existing subscribers over the next few months.
These changes will not only effect subscribers in the United States, but 40 other markets in Latin America where they charge customers in U.S. dollars. Mexico and Brazil will be unaffected by the price changes at this time.
“We change pricing from time to time as we continue investing in great entertainment and improving the overall Netflix experience,” a Netflix spokeswoman said in a statement.
Netflix last changed their pricing in 2017, where they increased their $10 plan to $11, and their $12 plan to $14.
The pricing increase comes after Netflix has begun investing heavily in all forms of content. The streaming company reportedly spent at least $8 billion on content last year, and it plans to take on $2 billion in new debt.
The company reported $8.34 billion in long-term debt on September 30th which was nearly a $2 billion increase from 2017 where their long-term debt was at $6.5 billion.
The company has seen an increase in subscribers reporting that it had 58 million subscribers in the United States and 137 million globally. However, they project they their global subscriber count will increase by 10 million when they next report their figures.
Netflix’s price increase comes as a number of major media companies are looking to launch their own streaming services. The much anticipated Disney+ streaming service is expected to launch this year with content from Marvel and Star Wars including a show starring Tom Hiddleston as Loki.
Disney isn’t the only company getting involved, NBCUniversal recently announced they will be launching their own service beginning in 2020.
WarnerMedia, Warner Bros. and CNN’s parent company will also offer their own service that will have different options for original programming as well as movies. This will be separate from WarnerMedia’s DC Universe streaming service which launched last year that includes comics, original programming, as well as older films and television with a focus on DC Comics related properties.
CBS also launched their streaming service last year with Star Trek Discovery.
Needles to say there looks to be a lot of competition for Netflix coming around the mountain.
What do you make of Netflix’s price increase? Will it affect whether or not you stay with service or plan to purchase it?