Netflix to Raise Prices for New Customers
Netflix announced Monday that by the end of June, the companyplans to raise subscription prices for new members by $1 or $2 in an effort to offer a wider variety and better quality streaming for customers. Netflixexplained in a letter to shareholdersthat existing members will eventually have to pay the increased price, but that would not come into effect "for a generous period of time". The exact price increase will depend on the country. Netflix reports that in the first quarter of 2014, 4 million new subscriptions were purchased bringing the total global subscriber count to48 million.
Netflix attributes the increase to a rise in demand as more shows andoriginal content--like "House of Cards" and "Orange is the New Black"--are available to users. Back in 2011, Netflix announced a plan to raise DVD delivery and streaming services to $16 a month, but it was met by too much backlash and a steep stock decrease so no action came of it. Monday'sannouncement came with much less oppositionand Netflix shares were up 7% by the end of the day.