Netflix is planning to raise prices... again
Illustration by Alex Castro / The VergeNetflix is planning to increase the cost of its streaming service yet again, according to a report from The Wall Street Journal. The streamer will reportedly issue the price hike a “few months”...
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Netflix is planning to increase the cost of its streaming service yet again, according to a report from The Wall Street Journal. The streamer will reportedly issue the price hike a “few months” after the Hollywood actors strike ends, which could happen in the coming weeks.
As reported by the WSJ, Netflix will raise prices in “several markets globally,” starting with the US and Canada. It’s still not clear how much Netflix will raise prices, and Netflix declined to comment. Netflix raised prices across all of its plans last year, bringing the ad-free Standard tier to $15.49 / month and the Premium plan to $19.99 / month. The company also rolled out a $6.99 / month ad-supported plan and later axed its mid-tier $9.99 / month basic ad-free plan.
Earlier this year, Netflix cracked down on password sharing and started charging an extra $7.99 per month to share your account with someone outside your household. The move to raise prices again also comes as Hollywood moves closer to getting back to work. Just last week, the Writers Guild of America (WGA) ended its strike and began voting on a contract with major Hollywood studios, including Netflix, that could change the business of streaming.
According to the WGA’s calculations, the cost of their new contract will amount to just 0.2 percent of Netflix’s annual revenue
For example, Netflix, Disney Plus, Hulu, and other services will now have to share streaming data with the WGA under the new contract, allowing writers to see how well their content performed. The contract also grants writers of streaming features a minimum compensation increase of 18 percent for high-budget films, along with a 26 percent increase in residuals. According to the WGA’s calculations, the cost of their new contract will amount to just 0.2 percent of Netflix’s annual revenue.
Meanwhile, Hollywood actors still remain on strike, which means some productions are still on pause. Netflix is likely waiting until the end of the strike to raise prices, as hiking up costs when no new content is coming out doesn’t seem like a smart move. Once both writers and actors are back to work, there will likely be a lot of new shows and movies coming out that Netflix can use to justify the increase.
In addition to the news about Netflix, the WSJ also reports that Disney Plus could launch a new live sports tier outside the US. Disney Plus is no stranger to price hikes, either, as its most recent one goes into effect later this month.
(Disclosure: The Verge’s editorial staff is also unionized with the Writers Guild of America, East.)
