LOS ANGELES, Jan. 14 (Reuters) – Netflix Inc. has raised its monthly subscription price in the United States from $ 1 to $ 2, depending on the plan, to help pay for new programs to compete in crowded streaming, the company said Friday. TV market.
The standard plan for allowing two streams simultaneously now costs $ 15.49 per month, up from $ 13.99 in the United States.
Prices also rose in Canada, where the standard plan rose from C $ 14.99 to C $ 16.49.
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Shares of Netflix rose nearly 3% to $ 533.84 on the Nasdaq, Reuters reported on the price increase. They ended 1.3% higher at $ 525.69.
The first increase in those markets after October 2020 came into effect immediately for new customers. Existing members will see new prices in the coming weeks when they receive their monthly bills.
“We understand that people have more entertainment choices than ever before, and we are committed to providing a better experience for our members,” a Netflix spokeswoman said.
“We are constantly updating our pricing so we continue to offer a wide variety of quality entertainment options. As always we offer a wide variety of plans so members can choose the price that best suits their budget,” the spokesman added.
The world’s largest streaming service is facing stiff competition from companies that attract visitors to online entertainment. Walt Disney Co. (DIS.N), AT&T Inc (TN) WarnerMedia, Amazon.com Inc and Apple Inc (AAPL.O) One of the competitors pouring billions into the new programming.
Netflix has added customers despite the pre-price hike, which shows that its members are willing to accept higher costs, said Evercore ISI analyst Mark Mahani.
“This is a testament to Netflix’s pricing power,” Mahane said.
Netflix has said it will spend $ 17 billion on programming in 2021. The company has not released spending for 2022.
Netflix’s premium plan for streaming four streams and Ultra HD simultaneously increased by US $ 2 to $ 19.99 per month. For Netflix’s base plan, with one stream, the cost increased by $ 1 per month to $ 9.99.
In Canada, the premium plan C $ 2 increased to C $ 20.99 and the base plan C $ 9.99 remained unchanged.
At $ 15.49 per month, Netflix’s standard US plan now costs more than competitors. HBO Max, AT&T Inc (TN), Currently offers $ 11.99 advertising per month for 12 months.
Price of Walt Disney Company (DIS.N) Disney + $ 7.99 per month or $ 79.99 per year.
The United States and Canada are Netflix’s largest region with 74 million streaming subscribers as of September 2021. In the third quarter of 2021, the company accounted for approximately 44% of revenue or approximately $ 3.3 billion.
Most of the company’s latest subscribers are from overseas.
The growth of Netflix subscribers slowed down at the onset of the Kovit-19 epidemic, but recovered with the help of a global event called “Squid Game”, South Korea’s dystopian thriller released in September. Total global subscriptions reached 213.6 million.
When Netflix records quarterly earnings, the company’s next subscriber report will be released on Thursday. According to Thomson Reuters I / B / E / S data, analysts estimate that the company will announce 8.5 million new records between October and December, bringing its global subscriber base to 222 million.
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Lisa Richwin Report; Additional Report by Don Similevsky; Cynthia Asterman Editing
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