Netflix May Raise Its Prices Soon!

  Netflix May Raise Its Prices Soon! New data from TV ratings company Nielsen reveals just how much more value Netflix provides compared to its peers. Netflix (NASDAQ:NFLX) has also seen the rise of rivals it competes with in the last few years that consumers have spent at home. Walt Disney (NYSE:DIS) and its longtime rival Amazon (NASDAQ:AMZN) accelerated their investments in streaming content in 2020. Despite this, Netflix isn't afraid to hike subscription prices.

Nielsen's New Measurements

Last week, television ratings company Nielsen released its first report on video streaming interaction called The Gauge.

Conclusion

Americans are watched twice as often as Hulu, the closest video streaming service to Netflix. It's true that Netflix has more subscription and monthly costs than Hulu, yet Netflix continues to provide tremendous value. Netflix is ​​about 16,7 % more expensive in terms of monthly subscription fees and has 61 % more subscribers. Based on that number, there's room for Netflix to increase its price by about $1 more per month.owner. Based on that number, there's room for Netflix to increase its price by about $1 more per month. Also, if we look at it in the value category, the difference between Netflix and Disney+ is even bigger than the difference between Netflix and Amazon.

Beating cable TV

Americans who still love cable TV spend about 39 percent of all TV time on cable TV. Cable subscribers, whose average bills are around $100 per month, do not provide the same value as Netflix even if they watch TV for hours every day. As a result of the analysis, it is clear that it will not be long before video streaming surpasses cable TV.

How much would a price increase for Netflix cost?

If Netflix increases its subscription price by $1 per month in the US next year, it will generate an additional $800 million in revenue from its US subscribers alone. If we add neighbors such as Canada to this, we are talking about an annual income that can exceed 900 million dollars. All these indicators show that Netflix still has a lot of operating earnings!    

Source: The Motley Fool

 

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