Netflix has traditionally been a pretty cheap form of entertainment, but the company has spent the last several years beefing up its programming lineup and price increases have happened thanks to the big budgetary changes. Regardless, recently Netflix CEO Reed Hastings recently revealed during the company's Q3 earnings call that more price changes don't seem to be coming... at least in the near future.
We have no plans on price increases outside of inflation adjustments which we do in Brazil, which is the law there. We've had a great couple years at these price points and there's a lot of competition entering the market. What we're focused on is, 'how do we increase value to the consumer?' By having more spectacular shows so that people watch more of Netflix. And over time, that will take care of itself but we don't want to get overconfident just because we've had a good couple years here.
The news (via The Wrap) should come as good news for Netflix subscribers---at least those that are living outside of Brazil---but it's also a little confusing, given statements that Hastings and other Netflix employees have made in the past. About a year ago, Reed Hastings confirmed that the subscription streaming service would be increasing prices, albeit slowly. At the time, he noted that the price changes would come "over the next decade," and his recent statement doesn't exactly contradict that. Instead, it just seems as if more price changes won't be coming tomorrow. Netflix wants to keep luring in as many people as possible and getting them to see the value of the original content the company produces before they drop that next price change bomb. Not exactly a bad plan if you are in the business of making money.
It should be noted that the subscription streaming service did recently increase prices for its most popular package, with longtime subscribers getting grandfathered into their old cost for a time period before the bump-up in price actually happened service-wide. Everyone only got on the same page in terms of how much they were paying for Netflix this summer, and the company's strong Q3 earnings indicate that the price hike currently isn't affecting the business model despite other earlier setbacks.
No subscriber ever wants to hear about price increases, especially when those price increases are like a dollar or more. In the scheme of things, a dollar isn't all that much, but when a dollar is like 10% of the overall cost of the service, it starts to get a little more annoying. Down the line, the cost of Netflix could even hike up quite a bit higher, past the costs of HBO's subscription service, even. But that's not happening, yet.
The nature of TV is changing. There are a ton of different ways to watch the medium at this point. There are streaming sites like Netflix and Hulu, there's still traditional TV, and even cable channels have worked hard to produce their own originals in recent years. Eventually, we'll figure out exactly which mediums will be able to nab a significant amount of our attention, but right now, things are all over the place. As a TV viewer, it's kind-of an exciting place to be. Now, let's just hope the cost stays low while these services figure things out.
If you'd like to take a look at what Netflix has coming up, check out our Netflix premiere schedule.
