What the Tech: Netflix price increase

What the Tech
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Netflix is raising prices for current customers and increasing the monthly rate for new customers. The increase in monthly subscriptions is $1 or $2, depending on which package you subscribe to.

Netflix is spending a lot of money now acquiring new content and producing its own movies and TV shows, but could this be the start of cord-cutting being less of savings over cable and satellite than it is right now?

Netflix lowest streaming package is $7.99 per month, but that restricts customers from watching Netflix on more than one device at the same time. It is also for Standard Definition. To watch on 2 screens in Standard HD, the cost is $12.99/month, and to watch on 4 screens (including phones, tablets and televisions) in Ultra HD costs $16.99 per month.

For cord-cutters, watching live TV requires a second streaming service such as Sling, Direct TV Now or YouTube TV. Sling is the most popular of those and monthly subscriptions start at $25. The company calls the packages “Orange” and “Blue” and each one includes a different package of live TV shows. To watch a combination of the two, Sling’s monthly charge is $40 per month, which also allows up to 4 people to watch at once.

If that’s all you need, or get, adding the most expensive packages is still much cheaper than cable or satellite.

But here’s why I think it could get interesting: These companies are attracting new customers every day with free-trials and low prices. What happens next? Will prices for all cord-cutting services go up? And how much? Will networks begin charging the streaming services more to air their programming? Like they have with cable companies?

Like I said it’ll be interesting to watch.

As of last December, Netflix had 58 million subscribers in the United States. The increase means an additional $250,000,000. It’s stock ended the day down 2 percent from Tuesday.

Copyright 2019 Nexstar Broadcasting, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

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