Saturday, December 9, 2023

Netflix prepares to raise its prices again

Netflix would be considering raising the prices of its advertising-free plans againas reported The Wall Street Journal. The intention of the streaming platform would be to make it effective once the Hollywood actors strike endsso it could only have an impact in a few months.

Even so, it is still bad news, considering that Netflix price increases have become recurrent in recent years. It is still unknown if the measure will affect all the regions in which the service has a presence, although the aforementioned media indicates that the idea would be to implement it in “several global markets.” starting with the United States and Canada.

Although the Netflix price increase would be a decision made, it is not known how much the plans without ads would rise. It is also not clear if the percentage increase would be applied homogeneously in all the countries where it applies, or if the issue would vary depending on the economic situation of each one.

Netflix would raise its prices after the Hollywood actors’ strike

Without a doubt, it is striking that Netflix is ​​waiting for the Hollywood actors’ strike to end to raise the prices of its subscriptions. But It makes a lot of senseconsidering what happened recently with the end of the writers’ strike.

The new agreement between the Writers Guild of America (WGA) and the Alliance of Motion Picture and TV Producers (AMPTP) imposes several conditions on streaming platforms such as Netflix, Disney+ or Amazon Prime Video, to name a few. Among them, an 18% increase in the minimum initial compensation that a writer must receive when working on original productions whose budgets are $30 million or higher. To which is added a 26% increase in the payment of residuals, as well as bonuses based on the audience generated.

It is logical to think, then, that the Actors Guild (SAG-AFTRA) is also negotiating higher contracts that impact this type of services. So the price increase could be one of Netflix’s ways to absorb the blow of the new agreements. Although we will not know if this is really the case until the conflict that still holds back a large part of the entertainment industry ends.

Looking for new income

It is true that Netflix has been experimenting with new methods of generating money since before the conflict with Hollywood actors and screenwriters. This year, the platform implemented paying extra by people who want to use an account and do not live with its owner. A measure that came into effect in Spain last February, and that in May was moved to other markets such as Mexico and Argentina.

In July, meanwhile, the company chose to eliminate its cheapest ad-free plan in the United States and the United Kingdom. Thus, it created greater separation between its cheaper, ad-supported option, which launched in late 2022, and its more expensive but ad-free subscriptions.

There is still no agreement in sight between SAG-AFTRA and the studios to end the Hollywood actors’ strike. So, until that happens, Netflix users would continue to enjoy the current prices. However, it is important to be prepared because It would not be strange if the increase in price is transferred to other streaming platforms.

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