On Friday, the company confirmed that it will raise prices for the seventh time in 11 years.
This year's price hike is the only one that hits all three subscription options. The "basic" tier, which is capped at 720p and includes other limits, gets its first increase in three years. The standard tier goes up by $1.50 per month. The premium tier of the 4K tier goes from $2 to $19.99 per month. Canadian customers can expect the same price increases for all tiers.
All customers will get 30 days' notice before the higher prices go into effect, and the price increases will roll out in phases to existing customers. The higher prices must be paid by brand-new customers immediately.
Paying more for a better experience.
A representative of the company gave a strange explanation for the price hike. The statement said that they understand people have more entertainment choices and are committed to delivering an even better experience for their members. We are updating our prices so that we can continue to offer a wide variety of quality entertainment options. We offer a range of plans so members can choose a price that works for them. The representatives from the company did not reply immediately to the questions from Ars Technica.
Customers are reminded of the growing selection of affordable streaming options. Amazon Prime Video, Apple TV Plus, Disney Plus, and Paramount Plus all cost less per month than the "standard" tier of the service. Most of those include 4K viewing options for no additional fee.
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In terms of exclusive content, the company has been bullish on both producing its own films and series and signing big-ticket deals with popular content producers. In its biggest licensing deal of the year, Netflix secured the exclusive streaming rights to Seinfeld for five years at a reported cost of over $790 million. As other streamers open their pocketbooks, they lock down their own exclusive licensed film and TV libraries.
The company's Friday statement left out one of its selling points: exclusive library games for mobile devices. In order to get in on the action, Netflix has rolled out a selection of simple, family-friendly games, which are all free of ads and microtransactions. It's no small selling point since it gives families a simple, ad-free source of games that can be easily handed to children. Apple One is the only one of the other streaming services that is comparable, and it is a bundle of Apple TV+, Apple Arcade, and other services that is less expensive than the standard tier.
There is a brief look at the history of the price hike.
With how much data it has accumulated about subscriber drop-off after any of its previous price increases, it is in a position to weigh the pros and cons of price increases at any time. The first true hike to its streaming service came in 2011, when it stopped offering a bundle of physical DVD rentals and streaming access to US subscribers for $9.99. At the time, customers were told that they could access each service separately for $7.99 a pop. There are still physical DVD and Blu-ray rentals for users of the service in the US.
In the years since that, the company has delivered a mix of new tiers and price increases to those tiers, with the "premium" plan going live in 2013 and the "basic" plan going live in the fall of 2014). We published a report about the drop-off in subscribers at the end of the decade, which could have been due to a 2020 price hike, a changing streaming consumption pattern, or both.
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