The company said in a letter to shareholders Monday that it’s going to raise prices for new members by the end of June. The price increase will be “one or two” dollars per month “depending on the country.” It won’t initially apply to Netflix’s existing members, who will pay the current price “for a generous time period.”
The company is being rightly cautious in increasing subscription rates. Its 2011 attempt to generate more revenue by separating its DVD-by-mail and streaming services into separate businesses was disastrous for Netflix’s brand and its stock price. Since then the company has earned back credibility with customers by bankrolling a growing stable of original shows and inking licensing deals with big entertainment companies like Disney.
The news of a price hike comes as Netflix continues to add new subscribers at a rapid pace. The company added 4 million new members in the first quarter of 2014, bringing its total subscriber base to more than 48 million globally.
It’s unclear for existing members how long the grace period will be, though.
sources: Huffington Post, Time.com