This is how it begins. As each major streaming service starts raising its prices incrementally, we’ll all shrug and ask “what’s just two more dollars a month?” Before we know it, it’ll be 2025 and we’ll all be paying cable prices for streaming services. I’ve said for a while now that streaming is merely the new cable in its infancy, and headlines like these are the first signs that it’s coming true. According to reports this week, Netflix is raising prices across the board on all of its subscription plans. Will this be the price hike to drive subscribers away?
Don’t count on it. Despite occasional criticism for similar price hikes in the past, Netflix still dominates the subscriber wars and enjoys a comfortable place atop the streaming market. This latest price hike will see prices increase from $11 to $13 for Netflix’s standard HD subscription package, while Netflix’s most expensive 4K plan will go up from $14 to $16. The basic, non-HD plan, meanwhile, will only go up one dollar from $8 to $9. According to the AP, the prices go into effect immediately for new customers and will roll out over the next few months for all of the existing 58 million US customers.
The price hike is designed to help Netflix pay for the astronomical investments the company has made into studios, original and licensed content, and a huge push for international expansion. Despite all of the investment over the last several years, Netflix is facing increasingly stiff competition in an ever-crowding market as big names like Amazon and Disney are looking to carve out their own slices of the streaming pie.
The last time Netflix raised prices in 2017, CEO Reed Hastings says that “price is all relative to value,” meaning he believes his streaming service is offering an ever-increasing value for the ever-increasing price. At what price point will subscribers have had enough, though?