Netflix Prices Going Up In May

| by Jordan Smith

Netflix, a popular, online entertainment service, will increase its subscription prices for existing users next month.

A monthly subscription to Netflix in the U.S. was increased to $8.99 for new members in May 2014, and then to $9.99 last October, according to Business Insider.

Users who registered prior to May 2014 were grandfathered in to the $7.99 price plan, but that will come to an end in May.

The price raise is anticipated to affect around 17 million users, or about 37 percent of all customers.

While Netflix mentioned in the fine print that the reduced price for existing users would increase at a future date, many users were unaware of it. According to a recent JP Morgan survey, 80 percent of those affected did not realize they will be paying 25 percent more for the service in May, Business Insider reports.

A number of users responded indignantly online.

“Hey @netflix any plan on giving us more content with your price hike? It’s pretty garbage at the moment,” one Twitter user wrote, according to Hollywood Life.

“Netflix prices going up but my Netflix watching is going down. What am I getting for that price increase?” asked another.

An industry estimate by UBS suggests between three and four percent of customers will cancel their accounts, but the JP Morgan survey indicated up to 15 percent of users could do so.

“Nope, sorry netflix, I haven’t gotten a 25% raise in the last two years, so I won’t be staying on for the price increase. Later,” stated another Twitter user.

Even with the price increase, Netflix will remain one of the cheapest entertainment options, Business Insider reported. While an average hour of viewing costs $0.30 on pay TV, Netflix comes in at just $0.09.

Netflix users will be able to see when their price increase takes effect on their user page, since it depends on the customer’s billing cycle. The company confirmed in a statement to ABC that users would be notified in advance so they have enough time to cancel or change their plan.

A different timetable applies to customers in Britain, who will already be paying more in late April.

Other customers who joined more recently were given a one-year hold in October 2015, when Netflix announced its price increase, meaning they will continue paying $7.99 until October 2016. From then, they can choose to continue paying $7.99 per month for the standard definition service, or pay $9.99 for HD.

Sources: Business Insider, Hollywood Life, ABC News / Photo credit: Myles Aronowitz/Netflix via Business Insider

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