On Tuesday, Netflix announced it will raise its prices by 13 to 18 percent for U.S. subscribers. The price hike will be the largest in the history of the 12-year-old streaming service.
According to CNN, the upcoming Netflix price increase is being implemented to support the many new and original programs produced by the company. But how exactly will the price hikes affect U.S. users?
Netflix New Price Plans: Increase in Cost of Streaming Service Nears
If you take a look at Netflix's pricing plan page, it appears new customers joining in 2019 are already paying the new prices.
Netflix has three different plans for users to choose from—Basic, Standard and Premium. These plans used to run from $7.99 to $13.99. Under the new pricing plans, each sees an increase of $1 to $2 per month. The breakdown is as follows:
- Netflix Basic Plan—$8.99 (Was $7.99)
- Netflix Standard Plan—$12.99 (Was $10.99)
- Netflix Premium Plan—$15.99 (Was $13.99)
According to Netflix, the new price plan will soon be applied to all U.S subscribers with rollout taking place "over the next few months."
Netflix's price increase won't just affect U.S. subscribers. An additional 40 countries in Latin America that bill in U.S. dollars will also see increases. This includes countries such as Uruguay, Barbados and Belize. The rate hikes will not, however, take effect in Mexico and Brazil.
"We change pricing from time to time as we continue investing in great entertainment and improving the overall Netflix experience," a company spokesperson said in a statement.
Netflix (NFLX) stock has seen a tremendous amount of growth in the last year and the new price announcement doesn't seem to have dampened that at all. In fact, the Netflix stock saw a 6 percent increase Tuesday morning at market open and remains steady at around $355 a share.
Can Netflix's New Prices Compete With Other Streaming Services?
The streaming service space is certainly growing more crowded each day as numerous big-name content creators dive in for a piece of the Netflix streaming pie. 2018 saw the launch of new streaming services such as DC Universe, while up-and-coming competitors such as Amazon Prime continue to up their content game as well. Meanwhile, Disney is planning to launch its own streaming service in 2019 which would include content from popular brands such as Star Wars and Marvel.
Despite the price hike, Netflix still serves as a solid choice for cord-cutters looking to save a dime on in-home entertainment as its pricing still remains competitive with the likes of Hulu, HBO, Showtime and other streaming content providers.
What do you think of Netflix's new price increase? Is it worth it? Share your thoughts in the comments below.
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