Netflix Raises Subscriber Price, Stock Price Climbs

With TV program costs likely to rise, Netflix is raising its monthly price for its standard subscription by $1 to $9.99.

The increased pricing will be for new subscribers in the U.S., Canada and some Latin American countries. The change is only for Netflix’s “standard” service, where consumers can stream HD programming on two screens.

The move does not affect Netflix’s “basic” service, which costs $7.99 a month for standard definition on one screen. It also does not affect Nielsen’s “premium” service, which costs $11.99 for HD to four screens, and Ultra HD when it’s available.

This is the second recent price increase of $1 this year. Netflix also raised prices by $1, from $7.99 to $8.99, in May. The company also raised prices four years ago in 2011.

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For some time, analysts of the company believed the subscription video-on-demand service would need to raise prices to fund its aggressive TV program development and acquisition costs.

Netflix stock dropped 12% in midday trading on Thursday after the pricing news was released. The video service stock was up 6.4% to close at $114.97.

Netflix has 69 million global consumers and 42 million U.S. consumers.

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