Netflix raises monthly subscription prices in US, Canada

LOS ANGELES, Jan. 14 (Reuters) – Netflix Inc has raised its monthly subscription price by $ 1 to $ 2 per month in the U.S., depending on the plan, the company said Friday, to help pay for new programming to compete in the crowded streaming The TV market.

The standard plan, which allows two simultaneous streams, now costs $ 1[ads1]5.49 per month, up from $ 13.99, in the United States.

Prices also rose in Canada, where the standard plan rose to C $ 16.49 from C $ 14.99.

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Shares of Netflix rose nearly 3% to $ 533.84 on Nasdaq after Reuters announced the news of the price increases. They closed 1.3% higher at $ 525.69.

The increases, the first in these markets since October 2020, took effect immediately for new customers. Existing members will see the new rates in the coming weeks when they receive their monthly bills.

“We understand that people have more entertainment choices than ever before, and we are committed to delivering an even better experience for our members,” a Netflix spokesman said.

“We are updating our prices so that we can continue to offer a wide range of quality entertainment options. As always, we offer a range of plans so that members can choose a price that works for their budget,” the spokesman added.

The world’s largest streaming service faces the biggest competition ever from companies looking to attract viewers to online entertainment. Walt Disney Co. (DIS.N), AT&T Incs (TN) WarnerMedia, Inc and Apple Inc (AAPL.O) are among the rivals pouring billions into new programming.

Netflix has added customers despite previous price increases, showing that members have been willing to accept higher costs, said Evercore ISI analyst Mark Mahaney.

“This is proof that Netflix has pricing power,” Mahaney said.

Netflix had said it would spend $ 17 billion on programming in 2021. The company has not announced spending for 2022.

The US price of Netflix’s premium plan, which enables four streams and ultra HD streaming, was increased by $ 2 to $ 19.99 per month. For Netflix’s single-stream plan, costs increased by $ 1 to $ 9.99 per month.

In Canada, the premium plan increased by C $ 2 to C $ 20.99, and the basic plan was unchanged at C $ 9.99.

At $ 15.49 per month, the US standard Netflix subscription now costs more than the competition. HBO Max, owned by AT&T Inc (TN), is currently offering a $ 11.99 a month promotion for 12 months.

The price of Walt Disney Co. (DIS.N) Disney + is $ 7.99 a month or $ 79.99 a year.

The United States and Canada are Netflix’s largest regions with 74 million streaming customers as of September 2021. The region accounted for almost 44% of the company’s revenue in the third quarter of 2021, or around $ 3.3 billion.

Most of the company’s latest collection of subscribers has come from abroad.

Netflix’s subscriber growth slowed from a boom early in the COVID-19 pandemic, but picked up again with the help of the global phenomenon “Squid Game”, a dystopian thriller from South Korea released in September. Total global subscriptions reached 213.6 million.

The company’s next subscriber report comes on Thursday when Netflix releases quarterly results. Analysts estimate that the company will report 8.5 million new listings from October to December, according to Thomson Reuters I / B / E / S data, bringing the global subscriber base to 222 million.

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Reporting by Lisa Richwine; Additional reporting by Dawn Chmielewski; Editing by Cynthia Osterman

Our standards: Thomson Reuters Trust Principles.

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