Netflix Announces Its Biggest Price Hike Yet

The price of subscribing to Netflix has just gone up as of today. Variety reports that all three of Netflix's subscriber plans, the basic plan, the standard plan, and the premium plan, will be impacted by a price hike. Both the premium and standard plans will rise by $2 each, from $10.99 to $12.99 and $13.99 to $15.99 per month, respectively.

Interestingly, the basic plan, which only offers subscribers a single standard definition stream, will be receiving its first-ever price hike, rising from $7.99 to $8.99 per month. The standard tier, which offers users two HD streams, and the premium tier, which offers four 4K streams, have been hit by price hikes in the past, but this is the biggest increase thus far.

“We change pricing from time to time as we continue investing in great entertainment and improving the overall Netflix experience,” a Netflix spokeswoman said upon announcing the increase in price. These new prices are effective in the United States immediately, although it will take a "few months" to move over existing subscribers to the higher prices. The increase will also impact roughly 40 other countries in Latin America. However, Mexico and Brazil will remain unaffected for the time being.

Upon announcing the increase, Netflix's shares rose by at least 6.8% in the morning. It's clear that with the $8.34 billion long-term debt they said they had on Sept. 30, investors are eager for the company to increase its revenue as soon as possible. The last time Netflix increased prices was in Oct. 2017, although they faced minimal backlash. Existing subscribers will be alerted of the price increases 30 days before it affects them.

Netflix's chief product officer Greg Peters said that they had "earn[ed] the right to increase price a bit" over time. "We take that new revenue, invested back into the model and that sort of continuous positive cycle we get to keep going, and we foresee that that will keep going for many years in the future,” he added.