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Netflix Announced their New Increase in Prices

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Netflix Announced their New Increase in Prices

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For the new year, Netflix decided to increase its prices in order to pay for its new streaming service contents. All three of their plans will increase between $1-$3. For example, the standard plan will now increase from $11 to $13 per month, whereas their $14 plan will go up to $16. Netflix claims that the changes to the price will happen over the next few months.

Recently their stock increased by 6%, but yet has been spending billions on content. It was said that the company is over 8 billion dollars in debt based off the companies own expectations in 2017. The company also admitted that in October they are taking on another $2 billion in debt. According to many sources, it seems like the only people who would be fine with the price increases would be the investors. The company claimed to have 58 million subscribers in the U.S, and 137 million worldwide. The company also projected last fall that the number of subscribers worldwide will jump to 147 million when it next reports its earnings. It seems that the company feels confident that they can make up for the debt in order to keep producing content.

At this point, many analysts claim that the price hike is important as other streaming businesses are coming in to compete. New competitors such as Disney+, will come into play this year and is said to include its content from their most popular brands like “Star Wars” and Marvel. Other companies such as NBCUniversal and WarnerMedia are also jumping into the race while promising that they will offer different package prices depending on the type and quality of documentaries/ movies the customers wants.

Although Netflix seems pretty confident that they can recover their debts, some critics had doubts since the company consistently “pumps out” movies and TV shows with little time at all. Their fear? That they won’t create good quality productions and that customers would leave for that reason. However,  many of the critics turned out to be wrong as Netflix recently took credit for big blockbusters like the movie, “Roma”, which has been nominated at the Oscars recently. Netflix also had another big success with their new original series, “Bird Box”, featuring Sandra Bullock. The show was considered their most successful project with 45 million viewership within the first week of its release.

Looking at statistics, it seems that Netflix will continue to be successful, and release new productions over the next few years. The only thing Netflix has to worry about is the new and creative ways they have to finance their growing business, and how they’re going to satisfy viewers with varying interests. Now, let’s see if Netflix can handle their biggest challenge yet- satisfying angry “Friends” fans and their demands for the show to be back on stream, which would cost them another $100 million.

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Netflix Announced their New Increase in Prices