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Netflix Raising Prices For 58M US Subscribers As Costs Rise

Netflix Raising Prices For 58M US Subscribers As Costs Rise

The price hike could help Netflix pay for programming. If the muted reaction to the company's recent, albeit modest, price increases are any indication, Netflix could charge as much as $15.50 per month for a standard subscription, now priced at $13, without much issue, according to Piper Jaffray.

Netflix's earnings report demonstrated the correlation between content spend and subscriber net adds remained stable with an R-square of 0.93 (i.e., as content spend increases so does net adds), Terry said in a note.

For starters, Netflix says its math shows that it now accounts for 10 percent of all TV screen time in the US.

However, Netflix spokesman told Associated Press that the streaming service weren't planning to cut the disaster scene from Bird Box, stating: "We will keep the clip in the movie". But this is the first time that higher prices will hit all 58 million USA subscribers, the number Netflix reported at the end of September. Netflix reported $4.19 billion in revenue, just under global forecasts of $4.21 billion.

The internet entertainment service provider announced on Tuesday it's raising prices of all of its subscription plans, a move that sent its stock price surging for more than 6 percent on the day.

Netflix (NFLX) said Thursday that it added almost nine million new paying subscribers during the final three months of 2018, beating its own expectations of 7.6 million new subscribers.




The share price fell in after-hours trading at one time, more than four percent.

Netflix Inc. shares slipped in late trading after fourth-quarter revenue came in below Wall Street estimates, a sign an explosion of new programming failed to hook enough viewers. "It will be interesting to see how Netflix responds to a future of smart, digital TV advertising and whether it will be forced into an ad-based model to sate the increasing consumer demand for exclusive and engaging content". The last time Netflix raised prices was in October 2017.

Netflix estimates that Bird Box, its buzzy film starring Sandra Bullock, was viewed by more than 80 million members in its first four weeks.

In December, Netflix said that more than 45 million accounts watched the apocalyptic film in its first seven days, marking a record-breaking debut. For the first quarter, Netflix predicted even a growth in customer numbers by 8.9 million, which was above the expectations of analysts.

"Our focus is not on Disney+, Amazon or others, but on how we can improve our experience for our members", the company said, referencing the name of Disney's new streaming service that is scheduled for launch this year.

It's unclear if Netflix is in the "beginning of the end" stages of its growth cycle or "end of the beginning", Martin said. Analysts are expecting earnings of Dollars 82 cents per share on revenue of USD 4.61 Billion.

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