Netflix hikes prices for third time in three years

LaToya Harding
·2-min read
Netflix logo is seen displayed on a tv screen in this illustration photo taken in Poland on November 29, 2020. (Photo illustration by Jakub Porzycki/NurPhoto via Getty Images)
Netflix, which is battling rival streaming services such as Disney+ and Amazon Prime, last hiked price in June 2019. Photo: Jakub Porzycki/NurPhoto via Getty Images

Netflix (NFLX) is set to raise its price for the third time in three years amid increased competition from rival streaming platforms.

The company will reveal on Thursday that its standard and premium packages will rise by £1 ($1.34) to £9.99 and £2 to £13.33 respectively.

Its standard package allows users to view TV shows and movies on two screens at the same time, while on the premium plan users are able to stream content on four devices simultaneously.

Netflix, which is battling rival streaming services such as Disney+ and Amazon Prime, last hiked price in June 2019.

Increases will apply to new members immediately and existing subscribers will be notified by email a month before the prices changes come into effect.

It also comes as Netflix aims to offset its spending on original films and series. The company has spent $1bn (£743) on British productions alone this year, the firm’s second most important market for production globally.

A Netflix spokesman said the money spent on UK content was helping create thousands of jobs and was showcasing British storytelling.

“Our price change reflects the significant investments we’ve made in new TV shows and films, as well as improvements to our product.

“Our basic membership will remain at the same price ensuring as many people as possible can enjoy our content.”

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Last week Netflix said it will start declaring its £1bn-plus UK revenues to HMRC, putting pressure on the likes of Amazon (AMZN), Google (GOOG) and other tech titans to do the same.

Since launching in Britain in 2012, the company has been moving the revenues it makes from its UK subscribers each year to accounts at its European headquarters in the Netherlands.

The revenue declaration will start from January 2021 and will add pressure to other major tech firms who have been scrutinised for channelling revenues, and profits, to tax havens.

A spokesperson for Netflix said at the time: “As Netflix continues to grow in the UK and in other international markets we want our corporate structure to reflect this footprint. So from next year, revenue generated in the UK will be recognised in the UK, and we will pay corporate income tax accordingly.”

Netflix has more than doubled its UK revenue from £500m in 2017 to around £1.14bn this year. It is estimated to hit 14 million subscribers next year, generating £1.3bn in revenues, according to analytics firm Ampere Analysis.

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