Longtime Netflix customers face price hike

Longtime Netflix subscribers will soon have to pick their poison — pay a higher monthly rate, get lower-quality streams, or cut off service entirely.

Two years ago, Netflix raised the rate for its standard monthly plan from $7.99 a month to $8.99 monthly. At the time, the company said the new rate would only apply to new customers and promised existing customers that they could keep their lower-cost plan for the next two years. In a letter to shareholders released Tuesday, company executives noted that two-year period will expire this spring.

In order to keep their same level of service, which gives them access to high-definition movies and TV shows and allows them to stream two different videos at the same time to different devices, customers will have to pay $9.99, the rate Netflix now charges for its standard plan after a second price hike last fall. They can continue to pay the $7.99 rate, but will only be able to stream video to one screen and won’t get access to HD videos.

Customers can also cancel their service, but Netflix’s executives don’t think many will.

In the second and third quarters of this year, “we’ll be releasing a substantial number of our U.S. members from price grandfathering,” Reed Hastings and David Wells, Netflix’s chief executive and chief financial officers, respectively, said in their shareholder letter. They added: “Given these members have been with us at least 2 years, we expect only slightly elevated churn.”

Netflix set off a firestorm among customers in 2011 when it effectively raised prices on both its DVD and streaming services by unbundling them and billing for them separately. Its DVD service never recovered from the move; it had just 4.9 million customers at the end of the year, compared to 24.6 million at the time of the split.

But Netflix’s streaming business quickly recovered from the brouhaha and has become a powerhouse in Internet video and Hollywood. The company’s last two price hikes caused barely a ripple among customers.

The Los Gatos company reported better-than-expected earnings Tuesday. The company’s streaming service now has more than 75 million customers worldwide.

Photo: Stock image of a couple watching Netflix (courtesy Netflix).

 

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  • Larry Sandwiches

    White people problems…..

    • NaginataX

      I think the correct saying is “1st world problems”

      • Larry Sandwiches

        Nah, thats completley different

        • ebie

          hahahahaha

        • NaginataX

          *loads the trap*

          Ok so you’re insinuating that all minorities are poor and can’t afford Netflix? 😉

          • Larry Sandwiches

            Thats a reach. But if thats what you took from it…….

          • NaginataX

            Not sure how it’s a reach when you explicitly say it’s a “White” problem.

          • Larry Sandwiches

            Like i said, if thats what you got from it…..

    • Southerngirl

      What a STUPID comment.

      • Larry Sandwiches

        Youre probaly a Southern “white” girl, so its easy to see why you cant comprehend that. Dummy

      • Anon

        I agree. That’s black people for you. Uneducated.

  • Larry Sandwiches

    White people problems…..

  • NaginataX

    Getting double-screwed by Verizon throttling Netflix anyway and now Netflix charging the consumer again? Screw it back to free streaming online.

  • Frank

    $1 increase in the five years I’ve had them wouldn’t kill me. Much better than the $15 TW increase over that same time period.

  • Frank

    $1 increase in the five years I’ve had them wouldn’t kill me. Much better than the $15 TW increase over that same time period.

  • John Casor

    They should offer a premium service. Let the folks who want to pay $10 a month watch the current lineup of old tv shows and foreign movies. I’d pay $20 a month if they had decent, current movies and updated their content regularly. I bet a lot of people would pay for that. Trying to keep the price so low is why the content sucks. It’s turning into Nick at Night on-demand.

  • DragonDagger

    Amazon Prime here I come, good by Netflix.

    • Ken Con Reeves

      I had Amazon Prime one time.. be careful.. If they have changed then cool but I was very disappointed with their shows they offered.

      • SavartiTN

        I prefer Netflix. No charges for any content. Amazon has shows that aren’t included in Prime and you have to pay for those. And they don’t update with new material very often so I find Amazon to be old and stale for most of the year.

    • KYlabrat

      Good luck finding quality programs on Amazon, and “getting” to pay extra if you watch their most recent TV shows. I subscribed this last year & can’t wait for my membership to expire. Ends up being SO MUCH MORE EXPENSIVE than Netflix…even including any price increase.

  • DragonDagger

    Amazon Prime here I come, good by Netflix.

  • Eric Clark

    *too many. I see you haven’t spent any extra time in the library

  • Eric Clark

    *too many. I see you haven’t spent any extra time in the library

  • Eric Clark

    *too many. I see you haven’t spent any extra time in the library

  • All that income and they have such crappy selections.

  • roylucier

    One dollar extra isn’t going to kill me, but they are really becoming too focused on TV shows lately and the movie selection quality has really dropped over the past year

  • Matthew Sotir

    They want to throttle my bandwidth and charge me extra? haha, no.

  • 1_800_un_effin_believable

    if they do not improve their movie offerings I will think about cancelling. they keep removing decent movies and replacing them with garbage I never heard of.

  • 1_800_un_effin_believable

    and I don’t like it when I am in the middle of watching a tv series and next time I log in they removed the series

  • sAy_YaS

    Its cable tv all over again.

    • alrui

      YEP, my thoughts exactly!

  • sAy_YaS

    Its cable tv all over again.

  • Bill Raleigh

    75 million customers @ $10.00 a month is 750 million a year. Does it really cost that much to run Netflix as a company?

    • Justin Kelly

      No, but they got to have that profit though, ISPs are charging netflix and they are passing the buck to their customers.

    • Roger

      Might want to check your math

    • John Morgan

      actually 9 billion

  • Bill Raleigh

    75 million customers @ $10.00 a month is 750 million a year. Does it really cost that much to run Netflix as a company?

  • Bill Raleigh

    75 million customers @ $10.00 a month is 750 million a year. Does it really cost that much to run Netflix as a company?

  • Michelle Alexander

    I won’t mind the extra $2 a month just don’t ever add commercials, it is then I would leave. The content could be better, though.

  • SavartiTN

    The only problem that I have with it is that Comcast data capped my area to 300 GB per month for internet use. Now, Comcast claims that no one uses close to that but everyone in my area either went over the cap or very near the cap the very first month that the cap was put into place. My internet streaming did not change at all and my use escalated from about 90 GB/month to 223 GB. Now, I don’t feel like I should watch as much on my old standard which is Netflix. I don’t stream HD because that uses more data. Comcast is causing many of us to not stream as much video. So, I have to make a decision as to whether or not this price increase is worth it since I am being held hostage by Comcrap. And, BTW, Comcast, this will not make me watch more of your cable TV. I will just turn to my books or go to movies at the theater or just plain old socialize a little more. That being said, companies like Netflix are the losers when Comcast decides to data cap.

    • John Morgan

      of course Comcast would say no one goes over that! my response would be, then why even cap it at that? i used to work for the blood suckers. the reason they do it is because basically no one just surfing the web would, but of course someone streaming video would do it easily. hence now since your getting your TV fix elsewhere. they in a sense found a way to tax you.

      • DataMatters

        The telecoms never got over charging per [some quantum] but at least it isn’t back to per minute.

  • Kargone

    This will be a tough choice. While their movie selection is beyond horrible they do have some good Netflix shows. If it weren’t for those I would have already canceled.

  • KYlabrat

    At twice the price, Netflix would still be the best deal on the planet (but please don’t tell them I said so). I rarely watch their movies; their TV programs are the reason I subscribe. I’m so spoiled–who would want to watch regular TV & wait a week (or longer) for the next episode? Watching episodes consecutively really makes more sense. This last year I also subscribed to Amazon Prime as there was one program that Netflix didn’t yet have the next year’s episodes — what a waste. I not only had the “privilege” of paying for the membership on Amazon, I was also “allowed the privilege” of paying $2-$3 for each episode. Thanks but no thanks – will not be renewing; thankfully, Netflix is still well worth the price & is still the easiest site to navigate, not cumbersome like Amazon’s.

    • John Morgan

      could not agree more! some people on here commenting either have never tried Netflix, or just love to hear themselves complain. i honestly feel that netflix is better than a basic cable package with at least one premium channel as well. plus everything is on demand watch it when you want to.

    • SeaGail

      Exactly. I was already am a Prime member – didn’t get it for the videos, just a perk, so no big deal for me there, but for me Netflix is one I go to the most. I knew that it was primarily there for their television show catalog, with the occasional older movies being available.

  • spawnkano

    With competition from other streaming services, Netflix is trying to one up them with original content. At this point what other streaming service has the amount of quality original programming that Netflix has made? In order to keep that train rolling along they need funds since they don’t have advertisers like cable. There’s also no word in the article about a price hike for the 4 device price of $11.99 which is my current plan.

    Recently I discovered Smartflix, which gives full access to the entire Netflix catalog from around the world, albeit with a minor inconvenience of running from a PC only as of right now. I have taken an older laptop with a broken screen and hooked it up to my 55″ tv and personally don’t ever wanna go back to using regular Netflix. Having Smartflix fully justifies the price regardless of the increase or not. Bottom line is that more quality original content needs to get its funding from somewhere and Netflix has done what they could to keep the prices competitive over the years.

  • elkhornsun

    We were planning to cancel our Netflix service next month anyway as their contents is not even close to what is available on Hulu or Amazon Prime (for which we pay nothing more for the video streaming). HD video is only a dream for us with our $400 a month T-1 service at our home in Monterey, and with the AT&T monopoly that is not going to change in the next 20 years anymore than it has in the past 20 years where all that is available from them is 56K dial-up for $55 a month.

    • KYlabrat

      $400 a month?

      • DataMatters

        Yes, for a T-1 line! Where I live, the DSL is so over subscribed that there are frequent brownouts where Netflix, Amazon, etc. streaming fails.

    • alrui

      Hey dummy, you PAY for Prime dont you? It aint “free”!

      • Anon

        Hey dummy, they said “Hulu or Amazon Prime (for which we pay nothing more for the video streaming.” YOU said it was free, not the person you were talking about. Maybe you shouldn’t go around calling people dumb.

        • alrui

          I NEVER said anything was “free” and thats my point! He says he pays “nothing more” for video streaming with Prime but youre still PAYING FOR PRIME! There is no “free” lunch PERIOD!

  • Jessica

    The reason the prices are going up is because the distributors of content have been increasing the costs to be able to license to stream. It is these costs that are driving up their prices and the fact that cable companies are holding on to their rights to broadcast longer.

    • John Morgan

      Jessica you are 100% correct. people don’t understand that anything in the entertainment industry is expensive. quick examples are when a ball player or actor makes 50 million in a year? that all trickles right down to you and I. not suggesting cable companies and such are not milking it for somewhat more. just saying anything in the entertainment industry is expensive. anyone that has their doubts should go price some concert or sports tickets today.

    • John Morgan

      Jessica you are 100% correct. people don’t understand that anything in the entertainment industry is expensive. quick examples are when a ball player or actor makes 50 million in a year? that all trickles right down to you and I. not suggesting cable companies and such are not milking it for somewhat more. just saying anything in the entertainment industry is expensive. anyone that has their doubts should go price some concert or sports tickets today.

    • Thor

      also not to mention they keep adding more shows which also will raise the price, Also people have to stop blaming Netflix for censoring /missing shows and blame there government or the who every has the rights. Netflix has to crackdown on vpn so they may end up getting into trouble and shows might go messing if they don’t crack down on vpn for the rest of us

  • Ty’s Blog

    Yes, but what about Canada? Seriously, with the Canadian economy in recession, I don’t think Netflix can afford to raise their prices here. Very little will be willing (or able to afford) the increased rate.

    Best of luck to Netflix, but I don’t see how the can succeed in the Canadian market if this proves true.

    • alrui

      The US isnt far behind!

  • hairyback

    They are subsidising it from us poor bastards in 3rd world countries who are paying $7.99 for one tenth of the content.

  • Snitchmo

    Amazon Firestick – $30
    jailbreak said Firestick – free Youtube video
    I can watch EVERYTHING out there. All TV channels, all episodes, all movies. So, why pay Netflix?

  • Snitchmo

    Amazon Firestick – $30
    jailbreak said Firestick – free Youtube video
    I can watch EVERYTHING out there. All TV channels, all episodes, all movies. So, why pay Netflix?

  • alrui

    Greedy prix! There will come a time when we go back to cable because these a-holios greed will make cable look like a bargain!

    • John Morgan

      cable can’t even come close to the value of a netflix subscription.

      • alrui

        At the moment no, in the future YES!

    • Say No To Mythology

      Do you know what their profit margins are? Do you know what their infrastructure costs are, both current and expansion, plus maintenance going forward? No, you don’t. Your opinion is uninformed and utterly worthless. Admittedly, with your limited intellect you might find sitting through commercials to be a reasonable use of your time, but I certainly do not. $9.99 for commercial-free shows I actually watch is a bargain compared to the outdated cable tv model.

      • alrui

        The limited intellect is coming from the person who cant comprehend English. Did you miss “will”? Im talking in a few years, not at the moment!

  • Tim Adams

    It’s the concept behind it..

  • John Morgan

    I for one am just as skeptical about price increases as the next guy. but anyone familiar with both Netflix and Cable, knows that Cable does not offer anything anywhere near the value of a Netflix subscription.

    • FresnoJoe

      Agreed~!

  • GingerJedi

    Netflix and other such services are becoming this generation’s Tower Records or Blockbuster Video. When you take products that were once free or at least cost effective and then price gouge the consumer for substandard versions with fees and ads and other such time wasting addendums, society deems “pirating” your product not as a crime but a logical solution to your heinous greed.

    • ellafino

      A two dollar raise is hardly price gouging. Given that other services like HBO, Showtime and Hulu charge the same or more it only makes business sense. They are after all a business.

      • FresnoJoe

        Amen~!

  • dee

    The streaming is nice but you can only stream older movies. You can only get the new movies by DVDs. That does not make sense. I want to know why the newer movies cannot be streamed. Because of that I cancelled the service.

    • Rapids444

      Because of the agreements that they made with the content owners…..

    • holdthepickle

      Because you canceled they have written you off and no longer care about you, your concerns, or your questions. It makes sense that they don’t care about you. Now they only care about bumping up their profits by raising prices just enough to not offend me, a customer who did not cancel. You are irrelevant. You opinion is irrelevant. Please tell us your opinion of Argentina’s national cricket team (which you also do not watch). Because we really want to hear your opinion on why we should not watch that either. Go to the redbox machine and wait in line behind their other smelly customers.

      • NegativeHelix

        Wow guy… Amazon, Walmart, Hulu, are all great monthly streaming services that show new movies a lot of the time before Netflix. Youtube also has a streaming service for new movies and shows. You can buy them individually or pay for a monthly membership… I mainly use Xbox Live. All the latest movies and shows for dirt cheap. And I think Redbox has online streaming now. There’s one called Crakle that offers the same old and D-list stuff on Netflix completely free of charge or membership…. So yeah you’re right, they probably do write off people who cancel. But at the same time there are other options. Nothing to get your butt hole so twisted up about.

      • Botswana Jones

        Who are you to say her opinion is irrelevant? Look in the mirror fool. Now go sit in the corner and beat yourself off.

  • Thor

    so basically there going to keep rising the price so they can add more movies because the company wants to add more show and the newest ones which cost more money.

    • Malone Sucks

      Actually i believe their new buisness plan is to add more original content and fewer new movies.

    • moonwatcher2001

      Like Malone says below, they are going to pour the money into some “original Netflix programming” of their own. It is far easier and cheaper to get some young hungry actresses to show their boobs in a badly written soap opera or period piece than it is to pay the studios more and more for movies. But to be honest, with Hollywood fixated on making every single freaking comic book into a movie to please the 15 to 25 year olds that make up their market, who knows, maybe Netflix will strike some gold, like HBO’s Deadwood did…

      • Thor

        there is a whole backside to the new movies for marvel and dc that people don’t really like

  • FresnoJoe

    $9.99? Right Back Where We Started From
    Great Service At A Doable Price

  • Nathan Forrest

    This is unacceptable after my baby mommas welfare can only go so I mean after weed and beer I almost don’t have the money for Netflix as is.

  • Jeffrey Bayes

    This past fall I received notice from Netflix that my current rate would remain in effect for the next 12 months. If they decrease quality by requiring me to pay more for HD before that year is up I’ll cancel. May cancel eventually anyway since it takes so long for seasons to be added, and I’m not that interested in most of their content.

  • tvzz smith

    at 10 dollars/mn off the amazon prime i go.

    • SeaGail

      Unfortunately, Amazon prime doesn’t have nearly the TV series catalog that Netflix does. I go to Netflix a lot more than I go to my Amazon channel on Roku. There is a plethora of sources of programming, but each has their advantages and disadvantages.

      • DataMatters

        Who cares, though? There are so many better things to do with my time! I watch Netflix mainly while running on a treadmill and my kids watch some of the cartoons, but it is completely replaceable in my life. It’s just like cable tv–the quality went so far down that it…just…had…to…go.

  • SeaGail

    Frankly I can’t even imagine ordering a DVD – everything can be rented streaming (Amazon, Vudu, and countless others on Roku, for sure). DVDs should have been discontinued a long time ago. They should have been working on a better business model for the future many moons ago.

  • RichardJ

    I’m a long time subscriber and am having a very hard time finding anything on Netflix worth watching anymore. I was going to cancel anyway before my “legacy rate” runs out. So much useless crap. I think the new model for me will be to come back to Netflix in about 8 or 9 months, renew for a couple of months till I’ve watched shows that interest me, then cancel again for another 8 or 9 months. And repeat…

  • Steve Bar Yakov Gindi

    By cutting VPN Netflix local is not worth the $8 , certainly not 10 . I will cancel if they hike it, since we can’t watch stuff we used to but still pay the same as when we used VPN

  • WD

    Hey people, I’m also a LONG time subscriber and will cancel my service when rate increase goes in effect. Think about it, Netflix will have to Open or Maintain 120 accounts just to break even for every subscriber they loose.

  • Anon

    I WILL complain and I’ll do it as much as I want. If you don’t like it, tough. Don’t read the comment.

    • michont

      Do what you want but be timely, OK. lol

 
 
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