Netflix prices are going up. Here'south when you'll have to pay more

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Source:   —  April 19, 2016, at 5:09 PM

First, the horrible news: Following month, Netflix prices will start going up for some customers.

Netflix prices are going up. Here'south when you'll have to pay more

First, the horrible news: Following month, Netflix prices will start going up for some customers.

Presently the excellent news: The longer you've been a Netflix subscriber, the longer you've until your price increases.

Netflix announced in Oct that it'd lift the price of its standard HD map to $10 per month, up from $9 per mo for recent customers and $8 a mo for longer-term customers who'd been grandfathered in.

The new $10 rate was expected to get effect in May. But Netflix announced Monday that it'll roll out the price hike gradually over the course of two thousand sixteen, a strategy it calls "un-grandfathering."

More than half of Netflix'south subscribers have been grandfathered into the lower prices, the company said.

Netflix also said customers should get an email notification explaining the company'south new new plans and options before their price increases.

In addition to the $10 plan, Netflix (NFLX, Tech30) will proposal a lower-priced $8-per-month option, which presents videos in standard definition and only allows one person to utilize the account at a time. Netflix also has a higher-priced $12-a-month plan, which broadcasts in ultra-high-definition and lets customers play videos on four screens simultaneously.

Customers will have to select one of the options -- or they'll be able to drop their subscription.

Related: Netflix up to 81.5 million subscribers but stock drops

Phasing out its grandfathered plans this way is an impressive indicate of customer loyalty. Netflix said it was doing it "to reinforce brand trust" and to "memorise as we go."

But on a conference call with investors, CEO Reed Hastings also admitted that the company doesn't "particularly necessity the income in the brief term, so it'south fine to just spread it out." Netflix has said that the additional income it hopes to gain from increasing prices will go towards licensing and creating better content for two thousand seventeen.

Netflix is treading lightly for a excellent reason. It doesn't wish a repeat of its two thousand eleven Quikster debacle, in which the company suddenly hiked prices sixty percent for people who were both streaming and DVD-by-mail subscribers.

The company initially spun off the DVD-by-mail business into a separate company called "Quikster," saying customers could number longer purchase DVD and streaming service from Netflix. It reversed that decision -- but not the price hike -- and Netflix lost nearly one million customers.

This time around, Netflix says it anticipates some "modest" customer losses, but expects the vast majority to stay, "partially because these members have been with us for a reasonable period already, and because our content continues to improve."

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