In the last six years, there have been four Netflix price hikes. The most-recent Netflix increase occurred in early 2019, and now that it's about a year later, customers are wondering if prices are about to jump again.
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Read on for a rundown of the streaming service, and learn whether you can expect a Netflix rate increase in 2020.
What Are Netflix's New Prices?
Netflix has three plans to choose from, with prices starting under $10:
- Basic: $8.99
- Standard: $12.99
- Premium: $15.99
Each plan offers a different number of screens you can watch Netflix on simultaneously, and with the higher tiers, you get HD or UHD viewing.
When Was the Last Netflix Increase?
The latest Netflix price hike happened in early 2019. At that time, the plans went up by $1 to $2 each. That may not sound like much, but it's an extra $12 to $24 per year, per viewer. Netflix implemented the rate increase so it could invest in more original programming.
The strategy paid off, as average revenue per user increased 22% year over year, and total revenue went up 31% year over year. But Netflix also knows it can't keep introducing higher subscription costs indefinitely. The 2019 increase resulted in a loss of approximately 180,000 additional subscribers last summer/fall, due to an estimated churn rate of 0.1%.
How Does Netflix Compare?
We've compared all the major streaming services, and Netflix has its strong points, but it isn't the ideal streaming service for everyone.
Netflix's prices are similar to Hulu's, but while Hulu offers add-ons for $8.99 to $14.99, Netflix is a straightforward cost with no extras. Your plan basically determines how many screens you can use the service on at one time (up to four), as well as whether quality is SD, HD, or UHD. Netflix also includes no commercials, a feature that many other services offer, as well. But services such as Hulu might only give you that perk if you have a particular plan.
When Will Netflix Raise Prices Again?
Given the rate in which Netflix prices have increased over the last few years, some subscribers are concerned they could see another hike in 2020. However, that seems unlikely for a few reasons.
One of the biggest is that the last increase centered on original programming. Rather than having to pay for content that was already made, subscribers basically prepaid for Netflix's plans last year. But while having a bigger catalog of original content is great, the company seems to have noticed that raising prices means customers are less likely to continually subscribe.
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Perhaps the biggest reason Netflix will need to be careful about another price increase too soon is that some competitors have far cheaper plans. Both the Apple TV+ and Disney+ streaming platform cost much less than Netflix's basic plan. Netflix plans start at $8.99, but Apple TV+ is $4.99 per month, while Disney+ is $6.99 per month. And if you want more than just Disney+, you can bundle it with Hulu and ESPN+ for $12.99 per month — that gives you a varied selection of programming and is the same price as Netflix's middle (and most popular) tier of service.
Readers, will you stick with Netflix another year if they don't raise the price? Or will you swap the subscription for something else? Let us know in the comments below.
I know I'm not the only one who chose to pull the plug and money stream from NetFlix.