Netflix raising U. S. prices

Netflix is raising the price of its U. S. standard and premium subscription plans, as the streamer continues to invest in content to differentiate itself from rivals.

The cost of its standard plan that allows for streaming on two screens will go up $ 1 to $ 14 a month, the Los Gatos company said Thursday, while the premium plan will increase by $ 2 to $ 18 for new customers. The price on the company’s basic plan will stay at $ 9.

The higher prices will take effect immediately for new customers. Existing customers will be notified of the increase 30 days before it goes into effect. The last time Netflix rose U. S. prices was January 2019.

“We’re updating our prices so that we can continue to offer more variety of TV shows and films — in addition to our great fall line up,” Netflix said. “As always we offer a range of plans so that people can pick a price that works best for their budget.”

The price increase comes after Netflix missed its own projections for global subscriber growth last quarter. The company added 2.2 million subscribers; it had forecast 2.5 million.

Netflix said it expects fewer subscribers to join in the second half of the year because of the unusually large number of people who signed up for the streaming service in the spring, as they sheltered at home during the pandemic.

It said it added 28.1 million subscriptions in the first nine months of the year, compared with the 27.8 million subscriptions added last year.

Analysts had expected a price increase to help fund more content and compete against a growing crop of rival streaming services. Some competitors have prices that are lower than Netflix’s cheapest plan, such as Disney+, which starts at $ 7 a month.

“There will be some subscribers who cancel when prices rise, but the number who churn out will be relatively small, and over the long run, it will be outweighed by the additional revenue that comes from the price hike,” said Ross Benes, an analyst at research firm eMarketer.