Netflix continues to be the king of the streaming services, and it's no stranger to raising prices occasionally on its variety of plans. The last major price jump came in 2019, but in Canada, the streaming service is raising the cost of its two higher plans. According to Bloomberg Netflix is keeping its basic $9.99 plan the same but is raising its standard monthly plan to $14.99 and its premium plan to $18.00, which is a rise of $1 and $2 dollars respectively. As for the reason why Netflix says the price increase is so it "can invest more in films and shows as well as the quality of members' product experience."
Netflix says the price increase is immediate for new members but will roll out to existing customers over the coming weeks based on their billing cycles. A notification about the price change will be sent to existing customers 30 days before the new price affects them.
Other services have undercut Netflix's subscription price, especially Disney+, which currently costs just $6.99 a month. Other services like Apple TV+ and Peacock also offer cheaper prices but don't have the wealth of content, especially original content, that Netflix has.
That's probably a big part of the reason that many Netflix subscribers say they would still keep the service if the price increased. A recent May 2020 survey by Cowen & Co analysts learned that 55% of users would stick with Netflix if they raised their prices, which was an increase from a similar poll run in December 2019 that tallied 47%.
Streaming services have become even more popular in recent months due to the coronavirus pandemic, with many staying at home and needing new content to watch with things like restaurants, movies, and other large events either completely closed off or open in limited capacities.
"With COVID-19 taking hold this year, we aren’t surprised that [Netflix] would gain pricing power as it becomes a more essential entertainment service, and our survey data supports this thesis," the analysts at Cowen & Co. wrote.
The last increase in the United States raised the basic plan from $7.99 to $8.99, while the standard plan went from $10.99 to $12.99. The premium plan went from $13.99 to $15.99.