If you’ve been using Netflix over the past couple of years, you’re probably accustomed to their occasional price hikes. In October 2023, Netflix raised the price of its basic plan from $9.99 to $11.99, which sparked some backlash among users. However, be prepared for another price increase by the end of this year.
Analysts from UBS Securities, as reported by Variety.com, predict that Netflix will raise prices for some of its plans. They base this prediction on a few factors, including an increase in viewership from 7.7% to 7.9% in Q4 2023, which suggests that previous price increases didn’t significantly impact the platform’s user base.
These analysts also point to traditional media companies increasingly turning to streaming services. These companies are focused on expanding their content libraries, reducing production costs, and emphasizing content licensing on streaming platforms. As Netflix remains the market leader in streaming platforms, it’s expected to benefit the most from this trend. Financial experts also anticipate Netflix’s revenue to increase by 15% by the end of this year, with some likely coming from planned price hikes.
Will This Increment Happen Though
Netflix has not officially announced any plans to raise prices, and few reliable sources have reported on the possibility of price increases. However, we should take this report seriously, considering the reasons given by analysts from UBS Securities and Netflix’s behavior in the last couple of years.
We can also consider hints from co-CEO Greg Peters during a Q4 2023 earnings call. Greg mentioned that they paused price increases in the past while introducing a paid-sharing program. Now that this program has ended, Netflix may return to its previous price-raising strategy. So, it makes sense for speculations about price increases to start coming up.
Potential Impact of the Price Increase
With people not canceling their subscriptions the last time Netflix increased prices, there is a high chance that some users may choose to unsubscribe if the upcoming changes are significant. It is also worth noting that competing products like Amazon’s Prime Video and Apple TV+ are improving and cheaper than Netflix. This could encourage some users to opt for these services even though they offer less content when compared to Netflix.
