Netflix hints more price hikes coming in 2024, phasing out its cheapest, ad-free plan
LOS ANGELES - Another price increase could be coming for Netflix subscribers.
In its quarterly letter to shareholders this week, the streaming platform hinted at the potential for subscriber price hikes.
"Over the last few years we've increased sophistication on our pricing and plans strategy so that we can more effectively capture the value created by our service," the letter to shareholders, dated Jan. 23, reads.
"We seek to provide a range of prices and plans to meet a wide range of needs, including highly competitive starting prices," the letter continued. "As we invest in and improve Netflix, we'll occasionally ask our members to pay a little extra to reflect those improvements, which in turn helps drive the positive flywheel of additional investment to further improve and grow our service."
RELATED: Netflix shares its viewer data on top TV shows, movies for the first time ever
Netflix previously raised prices in October, upping its Basic plan – which is no longer available to new subscribers – by $2 to $11.99 per month. The cost for premium plans also increased by $3 to $22.99 per month.
FILE - In this illustration photo taken on July 19, 2022, Netflix show selection is displayed on the screen of a smartphone with the account page in the background in Los Angeles. (Photo by CHRIS DELMAS/AFP via Getty Images)
What are the current Netflix price tiers?
Netflix’s current subscription options are:
- Standard with ads: $6.99/month
- Standard: $15.49/month (extra member slots can be added for $7.99 each/month)
- Premium: $22.99/month (extra member slots can be added for $7.99 each/month)
Standard subscriptions allow users to watch on two supported devices at a time, and give the option to add one extra member who doesn't live with them. Premium members can watch on four supported devices at a time, and add up to two extra members outside the household.
Netflix expects to phase out its basic, ad-free plan
Netflix’s Basic plan, which it phased out last summer for new and returning users in the U.S., is currently only available to those who were already subscribed to that option.
In its fourth quarter earnings report, the streaming giant said scaling up its ads business "represents an opportunity to tap into significant new revenue and profit pools" in the future. It noted how ad memberships increased by nearly 70% in the final quarter of 2023 – thanks in part to the phasing out of its Basic plan for new and rejoining members.
Netflix said it plans to retire its Basic plan in more countries, starting with Canada and the U.K. in the second quarter of 2024 and "taking it from there."
The company said ad plans now account for 40% of all Netflix sign-ups in markets where they are offered.
The news comes after Netflix announced a $5 billion live-streaming deal with WWE, in which it exclusively air "Monday Night Raw" beginning in January 2025.
RELATED: 'Cheer' star Monica Aldama's son charged with child pornography
This story was reported from Cincinnati.