Netflix stock goes down, prices go up
Netflix is one of the most popular video streaming platforms for students at the University of San Diego and colleges across the country. Not only is it a great way to relax and pass the time, but it’s become a trademark of the millennial generation.
However, for those who have been using the service for over a year, the price of a standard Netflix subscription is expected to rise by 25 percent as early as next month.
Netflix has slowly, but steadily, increased the price for a standard subscription. According to Business Insider, in 2014, the company raised the price for new subscribers by a dollar, from $7.99 to $8.99 per month, but existing users were not subjected to the price increase.
However, now all subscribers will be required to pay $9.99 for their subscription, even if they are not new to the video-streaming service. The early adopters of Netflix, who have been used to paying $7.99, will now be faced with these raising prices.
The price increase is in part a result of the company’s stock value that has been consistently dropping over time. According to Fortune Magazine, this year Netflix experienced a 14 percent drop in stock share price over the week of April 1, and the stock price dropped 12 percent within a single day of that week.
Market analysts suspect the drop was a result of an increase in the number of subscribers to other video streaming platforms such as Hulu and Amazon Prime’s video streaming service, Prime Video.
A subscription with Amazon’s service costs users $8.99 a month, a dollar less than Netflix’s current standard subscription price. The stock prices of all of these video streaming services fluctuate a lot, based on varying levels of demand.
Amazon Prime Video has proven to be Netflix’s main competitor in the video streaming platform market.
Senior Ghazal Babai has a standard Netflix account and is accustomed to paying the original $7.99 per month. She shared her thoughts on the price increase she would be facing if she were to keep her account.
“I think I will be cancelling my Netflix subscription; that’s annoying,” Babai said. “I wouldn’t want to pay for it anymore, because with Amazon Prime Video I would be getting more benefits than just movies and also I feel like Amazon has a better selection. If the price of my subscription raises by 25 percent, I’m definitely cancelling.”
Senior Claudio Trespalacios has a premium Netflix account, which provides users with ultra HD viewing and allows you to watch shows on four different devices at the same time, versus two devices that a standard accounts provides. Claudio currently pays $11.99 a month for his premium account.
“The price change doesn’t bother me since I don’t have the standard account,” Trespalacios said. “I also use Amazon Prime, but I would still continue my subscription with Netflix even if they increased all of the prices by 25 percent, since Netflix is worth so much more than 25 percent of what I am currently paying. I love Netflix, Netflix is life.”
Senior Maxine Velez also offered her opinion on how Netflix’s price increase would affect her.
“I’m poor, I have a standard account,” Velez said. “But the new price doesn’t bother me honestly because I don’t pay for the service, my mom does, and even if I did pay the difference it is so insignificant it wouldn’t cause me to switch. Either way I’m planning on changing my login information so my best friend and my boyfriend can no longer use it.”
Although Netflix’s increase in price for a standard account does not affect everyone.
Raising the price for only those who have had a subscription over a year may gradually rise for all of the service’s users if the company continues to experience a decrease in stock value.
Despite its popularity amongst Toreros, Netflix’s rising cost is something for students to keep in mind. The price of their subscription price will most likely change during our time at USD. Netflix will still probably contribute to our finals procrastination.