After password sharing crackdown Netflix may increase price

Netflix price: Netflix's password sharing crackdown was a huge success as the streaming platform likely boosted its subscribers by about 6 million in the third quarter. After this, Netflix is expected to set the stage for price increases when it reports earnings on Wednesday, reported Reuters.

Price Hike

Unlike, Disney which increased the ad-free prices this year, Netflix sought to curb password-sharing outside households to tap the more than 100 million viewers who use its service without subscribing.

“Netflix now closely resembles a utility in many markets,” analysts at Bernstein told Reuters. “The challenge of being labeled a utility is how a maturing company continues finding growth.”

Netflix is expected to increase the price of ad free content as most viewers who subscribed after the password crackdown have opted for the ad-free plans. Its standard plan with ads costs $6.99 a month, while the ad-free plans start at $15.49. Meanwhile, by increasing the price the streaming firm would push most of the subscribers to contents with ads as commercials help bring in more revenue per user.

“Using these tactics, Netflix will likely double its ad-supported viewership next year,” Insider Intelligence analyst Ross Benes told Reuters.

Reuters quoted Visible Alpha estimates and said the ad tier is expected to bring in some $188.1 million in revenue in the third quarter ended September, with subscriber additions of 2.8 million.

Hollywood Protest

Netflix is likely to hike prices after the end of the Hollywood actors strike. Five months after calling a strike that plunged Hollywood into turmoil, the Writers Guild of America (WGA) last week approved a new contract with major studios.

Netflix, however, has weathered the strike well due to its strong international presence.