Despite the steady growth in both annual revenue and worldwide user count, Netflix is still increasing prices for its Standard and Premium subscriptions. This time around the UK viewers are going to get the short end of the stick.
Prices are growing
The cost of the Standard package will increase from £7.99/month to £8.99/month, while the cost of the Premium package will see a bigger increase from £9.99/month to £11.99/month. Meanwhile, the cost of the Basic package is going to stay the same – £5.99/month. Earlier this year US subscribers felt a change in subscription fees first hand with their payments increasing from $1 to $2 per month depending on the package.
Competition grows stronger
Although at first, it may seem as backward, given second thought this seems like the next logical step in the company’s path. As Dinsey is about to roll out their Disney+ subscription service, which is going to include all of their super hit franchises (such as Star Wars, Marvel Cinematic Universe, Pixar movies, etc.) and universally beloved classics, and as Apple is making its’ Apple TV+ a reality this fall with a multitude of original shows, Netflix has to increase their subscriptions fees just to simply survive in the growing rivalry for the big money in the streaming business.
The reason behind the increase
According to Netflix’s CEO Reed, Hastings the price increase is set due to the services’ large future increase in original content – in 2019 the original content figure is thought out to be around $12bn. Nowadays the company is already in stiff competition with tech and streaming giants such as Amazon Prime Video and Hulu. All three of them are constantly investing in and creating original content, but with the aforementioned two new competitors, Netflix will need all the financial help it can get to not only keep its leadership position in the streaming service world but also to keep itself afloat.
The price increase for existing customers is set to take place shortly, new customers will have to start paying the new fees right away.
