Netflix share price up 1% after announcing price increases
The streaming company announces the second rate increase in a year.
Netflix share price is up after the streaming company announced that it is increasing prices again. US subscribers will see a price increase in their bills starting in May.
Why is Netflix raising its prices?
Netflix is raising its prices for the second time since January because the corporation is spending billions of dollars to provide thousands of hours of content to viewers. In 2018, the company budgeted $8 billion for original shows and movies to attract more customers, especially outside North America.
Netflix new prices: key figures
|Basic plan previous price $8||New price $9|
|Standard plan previous price $11||New price $13|
|Premium plan previous price $14||New price $16|
Netflix new prices
Subscribers who have the basic plan without HD see an increase from $8 to $9. Standard plan viewers who have HD access on two devices will have a rate hike from $11 to $13. Netflix customers who have the premium plan and can watch HD content on four devices will have to pay $16 instead of the current $14.
Why is the US Justice Department involved with Netflix?
The US Justice Department has intervened in the conflict between Netflix and the Academy of Motion Pictures Arts and Sciences. The Oscars organization wants to keep the streaming company from being considered for Academy Awards because Netflix films aren’t shown in theaters.
The Justice Department wrote a letter to the Oscars association warning that excluding Netflix from the Oscars could be considered an antitrust anti-competition violation.
‘In the event that the Academy — an association that includes multiple competitors in its membership — establishes certain eligibility requirements for the Oscars that eliminate competition without procompetitive justification, such conduct may raise antitrust concerns,’ said the Justice Department in the letter.
Netflix responded to the controversy by touting the company’s ability to provide customers easy access to a wide variety of films.
‘We love cinema. Here are some things we also love. Access for people who can’t always afford, or live in towns without, theaters. Letting everyone, everywhere enjoy releases at the same time. Giving filmmakers more ways to share art. These things are not mutually exclusive,’ said Netflix in a statement.
This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.
Seize a share opportunity today
Go long or short on thousands of international stocks.
- Increase your market exposure with leverage
- Get spreads from just 0.1% on major global shares
- Trade CFDs straight into order books with direct market access
Live prices on most popular markets