Netflix hikes prices on various subscription options in UK
Netflix has announced price increases for two subscription options
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Netflix will increase the price of two of its subscription plans in the UK.
The streaming giant has confirmed the cost of its basic, ad-free subscription, which is not available to new or rejoining customers, will rise from £6.99 to £7.99.
The premium subscription will rise from £15.99 to £17.99.
In a bid to crack down on password sharing, Netflix has introduced an additional fee enabling more than one household to share the same account.
Netflix prices for the basic, ad-free subscription and the premium subscription are increasing
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Netflix said this accounted for around 30 per cent of the new sign-ups in countries where it was available, claiming many users appeared to choose this option rather than quit the service.
Netflix’s latest financial results showed quarterly revenue was up 7.8 per cent year-on-year to 8.5 billion dollars (£7billion), with profits at 1.67 billion dollars (£1.38billion).
Ben Barringer, equity research analyst at Quilter Cheviot, said: “After a difficult couple of years, Netflix’s turnaround is complete, as its recent efforts to crack down on password sharing and subscribers leaving have paid off.
“Its latest set of numbers were strong, with subscriptions significantly better than the market was expecting and margins growing too.
“Indeed, they now guide their sales growth to be back in double digit growth, and there is no reason that they cannot kick on from here and cement its place at the top of the film and TV hierarchy.
“It will be introducing further price rises in the US from 2024, and with a strong content slate lined up, and the fact it is less impacted by the US writer and actor strikes, it is set up for a strong future.”
Sophie Lund-Yates, lead equity analyst at Hargreaves Lansdown, said: "The ad-supported tier is still very much in its infancy, and while a respectable whack of revenue’s being generated, the focus is very much on what the longer-term growth trajectory will be.
"There have been rumblings that the ad business isn’t as hot as it could be so there’s pressure for performance to keep moving upwards.
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"The market is increasingly preoccupied with where Netflix’s long-term growth drivers are coming from, with a limit to how far membership prices can be inflated in the current environment and the tailwind from the password crackdown due to taper out at pretty exceptional speed."
Netflix's basic ad-free subscription, which is rising to £7.99, allows members to watch Netflix on one device at a time in standard definition.
The Premium subscription, increasing from £15.99 to £17.99 lets users watch the shows in Ultra HD where available, on four devices at a time.
The streaming company also offers a standard with adverts option, for a monthly price of £4.99.