In an exclusive report, the Wall Street Journal announced that Netflix plans to raise its subscription prices as soon as the actors’ strike is resolved. According to sources, the streamer will increase prices on its ad-free package within a few months. The Journal was not able to nail down the exact amount of the increase or the markets it would impact.
This is the latest drumbeat in a chorus of price increases over the past year, with monthly costs increasing by an average of 25% over that time. Prices for ad-free tiers have seen the highest rise, whereas ad-supported tiers have stayed relatively constant. Streamers are trying to grow the audience for ad-supported streaming, so they can make that opportunity more appealing to advertisers.
Disney CEO Bob Iger said in August, “We’re obviously trying with our pricing strategy to migrate more subs to the advertiser-supported tier.” Streamers are trying to replicate a “cable model” in which advertising revenue contributes to revenue and profitability.