Netflix is raising the price of its standard ad-free plan for the first time in three years, though it will still cost less than the comparable version of Hulu
Netflix Inc. is raising prices again - though for some viewers, it's actually been some time since the last hike.
The company announced alongside its earnings Tuesday afternoon that it will be "adjusting prices" on most of its plans within the U.S. and Canada. Those changes amount to a monthly hike of $1 to $2.50, depending on the plan, according to pricing details shared by a spokesperson.
-- The ad-supported tier will cost $7.99 a month, up from $6.99 previously.
-- The standard plan will cost $17.99 a month, up from $15.49 previously.
-- The premium plan will cost $24.99 a month, up from $22.99 previously.
The cost for an extra member on an existing account will go up by a buck, to $8.99 a month.
There've been a host of streaming price increases in the past year, including for Warner Bros. Discovery Inc.'s (WBD) Max, Paramount Global's (PARA) Paramount+, and Walt Disney Co. (DIS) offerings like Disney+ and Hulu. Live programming services like Alphabet Inc.'s (GOOG) (GOOGL) YouTube TV has also gotten more expensive.
Until today though, Netflix (NFLX) had resisted hiking the price of its standard tier for years. The last price increase for that plan came in early 2022. Netflix raised prices on the premium plan more recently, in late 2023.
See also: Netflix's subscriber beat sends stock surging - and here's what's to come
This is also the first price hike for Netflix's advertising-supported service, which had been priced at $6.99 a month since launching in late 2022.
Granted, Netflix made one big change to its strategy in early 2023 when it began cracking down on account sharing. Account holders either had to start paying up to add extra users, or else those users had to spring for their own accounts.
At the time, Netflix was just getting started with its ad-supported offering, which proved a popular option for password sharers who didn't want to pay for the standard tier of service. People may end up "trading down" to the ad-supporter tier in the wake of the latest hikes.
On Netflix's earnings call Tuesday, Co-Chief Executive Greg Peters called the ad tier "an incredible entertainment value," with $7.99 representing "a highly accessible entry point," in his view. In the latest quarter, 55% of new signups to Netflix were to the advertising tier, based on countries where that plan is available.
Meanwhile, the new, $17.99 price of the standard tier compares with $18.99 for the ad-free version of Hulu and $16.99 for the ad-free version of Max.
-Emily Bary
This content was created by MarketWatch, which is operated by Dow Jones & Co. MarketWatch is published independently from Dow Jones Newswires and The Wall Street Journal.