Netflix plans to increase its subscription prices starting this month for all tiers in the US, the company said Tuesday. That means its most popular plan, which currently costs $11 a month, will rise to $13.
“We change pricing from time to time as we continue investing in great entertainment and improving the overall Netflix experience for the benefit of our members,” a company’s representative said in a statement Tuesday.
Netflix also will increase the cost of its cheapest plan by a buck to $9 a month from $8, the first increase to that entry-level price in almost 8 years. Its premium tier will rise to $16 a month from $14.
Netflix has long aggravated financial watchers with its eye-popping budgets despite its persistently low subscription price. Without enough money coming in from members to fund all its investments, the company has been taking on large sums of debt to keep expanding the amount of shows and movies it makes and continue upgrading its product. Indeed, Wall Street was pleased about the rate increase, with Netflix shares rising 6.4 percent to $354.28 in recent trading.
The company said the increases will begin Tuesday in the US and will also apply to countries in Latin America and the Caribbean where the company bills in US dollars, such as Uruguay, Barbados and Belize. The increases exclude major markets like Mexico and Brazil. The company, which operates virtually around the world except China, didn’t specify any plan for increases in other big markets in Europe or Asia.
New members will be signing up the new rates effective immediately, and existing members will see their bills rise progressively over the next few months. Existing members will be notified by email and within the Netflix app 30 days before the new prices are applied to them.
Netflix is expected to explain the pricing plan in detail Thursday, when it will report its latest financial results.
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