Netflix Inc. cracked down on password sharing earlier this year, and now the company is looking to boost revenue further with its latest set of price hikes.
The streaming giant plans to increase prices on various U.S. plans “starting today,” it said in its letter to shareholders Wednesday. While Netflix
NFLX,
intends to keep the price of its ad-supported service at $6.99 a month and maintain the standard plan’s $15.49 monthly cost, the company will boost the price of its basic tier to $11.99 a month and raise the monthly price of the premium tier to $22.99.
The basic plan previously cost $9.99 a month, and though Netflix recently discontinued it for new members, existing members have been able to stay on that tier of service. The premium tier cost $19.99 a month prior.
See more: Netflix’s stock jumps more than 10% on huge spike in subscribers
Netflix is also boosting the price of its basic and premium plans in the U.K. and France while keeping the ad-supported and standard tiers constant.
“Our starting price is extremely competitive with other streamers, and at $6.99 per month in the U.S., for example, it’s much less than the average price of a single movie ticket,” the company said in the shareholder letter, which accompanied Netflix’s third-quarter financial results.
Netflix executives said they “mostly paused price increases as we rolled out paid sharing,” but “as we deliver more value to our members, we occasionally ask them to pay a bit more.”
Whereas streaming companies spent the pandemic focused on gaining subscribers, now they’re looking to improve their financials. Walt Disney Co.
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announced its own streaming price increases back in August, while Spotify Technology SA
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boosted prices for its premium music plan in July.
Netflix now has an ad-supported tier, so management may figure that subscribers put off by the prospect of increased prices for ad-free service may be motivated to trade down to that less-expensive option. On the ad tier, Netflix monetizes its subscriber base both through the monthly membership fee and through ad revenue.
