Netflix Raises Subscriber Price, Stock Price Climbs

A spokesperson for Netflix said that to continue adding additional movies and TV shows including many original titles of Netflix, the company is modestly increasing the price of a few new members in Canada, the USA and Latin America.

The new $9.99 pricing is for new customers; current subscribers will continue paying $8.99 for the next year before the increase kicks in.

Furthermore, it also recently made a similar announcement, when it raised the price of standard plan of its subscription service by 1 Euro in Europe.

While not likely to thrill consumers, the Netflix (NASDAQ:NFLX) price increase revealed Thursday was a hit with investors.

The increase will generate an extra $750m a year in revenue for the streaming pioneer, which will be used to cover the cost of Netflix’s ever-increasing array of original content. If you’re an existing subscriber there’s no need to worry just yet, though. It informed existing customers then that it wouldn’t raise their rates for two years. Other monthly plans such as the four screens HD and one screen standard definition plan will not be affected by the price change.

Already with more than 65 million subscribers worldwide, Netflix plans to complete its global expansion plans by the end of 2016. Prices for its basic and premium tiers remain the same. Netflix stock jumped on the news. For the second time in 18 months, Netflix is raising its prices.

The company would not say whether the standard plan is Netflix’s most popular in Canada.

Bloomberg’s Lucas Shaw first reported the price increase.

Netflix is one of the most successful subscription services of all time, and with good reason.