New Netflix subscribers have been hit with a US$1 price increase which has lead to a decrease in subscriptions in the US in the September quarter.
In the third quarter, Netflix gained 880,000 US subscribers below the 1.15 million customers the streaming service had predicted. In the third quarter last year, 980,000 US subscribers signed to the service.
The decrease in subscribers has been attributed to Netflix decision to charge new users $9.99 a month in the US — an increase of $1. Current subscribers will not be affected by the price hike for two years, here is a screenshot of the email:
The company’s chief executive Reed Hastings told investors that subscription costs are increased to support the huge amount of Netflix original content. Netflix original programs include Orange Is The New Black, House of Cards and Narcos, among others.
“We want to take it very slow,” Hastings said. “Over the next decade I think we’ll be able to add more content and have more value and then price that appropriately.”
Netflix original content includes a Bill Murray’s musical Christmas special A Very Murray Christmas:
As well as Netflix original film, which is receiving Oscar buzz, Beasts of No Nation:
The US price increase has impacted on Netflix’s bottom line. The Wall Street Journal reports shares fell 3.9 per cent after having previously increased by 72 per cent in the past 12 months.
Netflix still has 69.17 million streaming members worldwide as of September 30-including free trials.