![]() Survey respondents can be all talk, he said. “If Netflix’s research shows that they will lose one-third of their premium subscribers on a $1 monthly price increase, they would be unlikely to implement the price increase.”Ĭolin Dixon of nScreenMedia also doesn’t see a third (or more) of Netflix users bailing after the next price increase. “Similar to prior years in which they instituted a price increase, (Netflix) would not do so without careful analysis in order to limit churn,” Reese told IndieWire. So that’s not going to happen it’s just what could happen with the wrong execution. If an instant 35-39 percent chunk of churn sounds astronomical, it would be devastating to Netflix. (No offense to CivicScience this is just how it works.) ![]() The streamer is regularly doing more market research on its own users than a one-off CivicScience survey. Netflix, a data-driven company itself, knows this. And what the CivicScience survey “doesn’t adequately address,” per Wedbush Securities analyst Alicia Reese, “is the precise price elasticity of its users.” A lump sum of users may indeed scrap Netflix at a $5 monthly increase, but probably not for a dollar or two. Not all price hikes are equal, of course. Netflix is “discussing raising prices in several markets globally,” WSJ wrote, “but will likely begin with the U.S. All rights reserved.ĬNN’s David Goldman contributed to this report.Measuring Applause at the Oscar Nominations Luncheon ™ & © 2023 Cable News Network, Inc., a Warner Bros. More price offerings could allow “entertainment fans from around the world that have different needs to be able to access the great story-telling that our creative partners are doing at a price-point that works for them,” Peters said. On the company’s earnings call, Peters said the company plans to eventually offer an even wider range of price points for Netflix subscriptions to grow its subscriber base. That’s why the company has been pushing its lower-priced ad tier, in which it can hide some of the cost by keeping prices low for consumers but charge more to advertisers over time. ![]() Netflix is one of the few profitable streaming services, and investors are demanding Netflix continue to grow its earnings. And the actors, who are still on strike, are demanding more, too. Making streaming shows will get only more expensive after the end of the writers strike, which boosted pay and benefits for Hollywood writers. Raising prices is one way to solve that issue. Meanwhile, consumer demand for streaming services has slowed dramatically since the pandemic, cutting into streamers’ revenue growth. Hollywood studios continue to demand more from streaming services for their TV shows and movies, as production costs rise. Discovery, raised prices in January 2023 by $1 a month – its first-ever price hike. And Max, owned by CNN parent company Warner Bros. Disney+ in August hiked prices by $3 a month – for the second time this year. Netflix last raised prices in January 2022, but its biggest competitors have all raised prices since then. Raising prices along with its competition “From a strategic perspective, we believe we can build games into a strong content category, leveraging our current films and series.” “Games is a huge entertainment opportunity,” Peters said. On the earnings call, co-CEOs Sarandos and Greg Peters also stressed Netflix’s investments in newer business areas, like gaming and sports content, to draw new subscribers. “We need to get a deal done that respects all sides as soon as we possibly can.” “The industry, our communities and the economy are all hurting,” Sarandos said Wednesday.
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