NEW YORK—Speculation that Netflix is set for another consumer price increase resurfaced Monday, 9/28, with Jefferies analyst Brent Thill releasing a note to investors suggesting a hike is “probable in the near- to mid-term.”
Netflix hasn’t upped its prices since January 2019, when its most popular “Standard” tier increased from $10.99 a month to $12.99. (It’s basic plan shot up from $7.99 - $8.99 at that time, and its premium offering went from $13.99 - $15.99.)
Thill believes a new price increase would affect all of Netflix’s global operating regions and that it could increase the streaming company’s 2021 revenue by $500 million to $1 billion.
Thill said Netflix can get away with raising prices in international markets due to its "deepening content library and outsized consumer value proposition.”
Certainly, Netflix did a little more than hint at coming price increases during its second-quarter earnings call in July.
Chief Product Officer and COO Gregory Peters noted that the SVOD service has spent the early part of the pandemic “making the service more valuable to that period of time, adding more content, adding more service features to that period as well.”
Examining its business “country by country,” he added, “it might be time to go back to them and ask them for a little bit more so that we can then invest that further into amazing stories, great content, better product experiences and create even more value for them.”
It’s worth noting that Netflix’s revenue spiked 28% to $20.15 billion in 2019 after that early-year price increase.
Netflix is also coming off a second quarter in which it added 10.1 million customers globally.
Conversely, the last time Netflix raised its prices, it wasn’t competing with Disney+, Apple TV+, HBO Max and Peacock, all of which have entered the SVOD market recently.
