When Will Netflix Increase Pricing Plans?

Netflix outgrew their estimate of new users in the United States by 50% in the last quarter.  The wildly popular video streaming service added over 900,000 new subs in the U. S. over the 2nd quarter of 2015.  Part of that growth was driven by Netflix decision to license Spanish language content for the U. S. market.  Single shows are getting hundreds of thousands of viewing hours a day.  The fast growth brought the question of how to increase profits moving forward.  CEO Reed Hasting spoke candidly of their plans to build revenue without raising prices in the near future.

In response to a question asking how Netflix planned to increase profits, Reed Hastings said that they didn’t plan to increase prices in the United States.  Instead they want to motivate customers to upgrade and offer incentives to move members up to a multiple screen plan or one that offers higher video quality including 4K.

Here’s a look at the current Netflix pricing plans for members who have been with the service for a long time.

Netflix pricing plans

The pricing differs slightly from what Netflix is offering new customers.  If you visit their site and sign up the price of the 2 screen plan is now $8.99 a month.  Members who were with Netflix before the price increase were able to retain the lower price.  At least through May of 2016 which is the ‘guaranteed price’ date listed for a few U. S. members we spoke to in preparation for this article.  It will be interesting to see what happens next May.

The regular pricing for Netflix is currently:

  • 1 screen, standard definition – $7.99
  • 2 screens, high definition – $8.99
  • 4 screens, HD and Ultra HD (4K) – $11.99

For my family the price of Netflix is more than reasonable.  We watch more tv shows and movies on Netflix than any other streaming service.  A small increase in price would not deter us from using the service.  That said, there are plenty of subscribers who would consider alternatives if the price increases in the future.  It will be interesting to see what happens as I’m sure Netflix will eventually raise their prices.  For now the chance to stream unlimited content from just $7.99 a month is a great value.

The interview above includes the estimates for Netflix growth.  Mr. Hastings said that they still see 60 to 90 million potential subs in the United States and hope to add 5 to 6 million new subscriptions per year.  Licensing Spanish language content for the U. S. market is helping drive the domestic growth.  Their plans go well beyond the local market though.  Netflix wants to grow into a worldwide powerhouse.  They want to be available around the world in the years to come.

This has been a big year for Netflix original content.  Ted Sarandos, Chief Content Officer, said that the new original content will only grow as popular series go into season 2, 3, and beyond.  The original content grows in popularity as more seasons roll out.  The original content helps in both gaining new subscribers and with customer retention.  We look forward to the continued growth of Netflix and other OTT streaming services.

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