Netflix Inc., the biggest online-subsription service in the world, made an official statement, revealing that it will increase its streaming services price for new members by a dollar or two on a monthly basis. This is the first price increase of the companys services since 2011. It is supposed to help Netflix pay for its long-term investment in original programs, which basically means that productions such as “House of Cards” and “Orange Is the New Black” are to become more expensive.
Netflix Corp. currently has more than 34 million paid subscribers in its home-market. The US company offers unlimited Web viewing at the price of 7.99 dollars a month. Reed Hastings, who is the Chief Executive Officer of Netflix, said on a webcast that current customers, who have been with the company for a few years now, wont be affected by the price increase in the next year or two.
Over the last few years, the company has become the biggest independent subscription programming service in the U.S., while making large investments in programming. The company is also known as a provider of relatively inexpensive online video services and one of the main rivals of Comcast Corp.
The CEO of Netflix Inc. – Mr. Hastings made a statement, which was cited by Bloomberg: “House of Cards,’ for which Season 2 debuted in February, attracted a huge audience that would make any cable or broadcast network happy. The on-demand nature of Netflix means that as we promote Season 2, we can still see significant new enjoyment of Season 1.”
It was also M. Hastings who revealed that Netflix is to oppose to the deal between Comcast Corp. and Time Warner Cable Inc., which is awaiting approval from the countrys regulatory authorities. He used the report of the companys earnings for the quarter in order to provide both interviewers and analysts with a basic idea of Netflix opposition to the merger.
As reported by the Financial Times, Chief Executive Officer Hastings said in an interview: “We respectfully think it’s not in the public interest to have one company control a majority of US residential internet [provision]. Our view is that the best remedy is to block the merger.”
Neflix Inc. added 0.80% to close at $348.49 per share yesterday, marking a one-year change of +113.31%. The 28 analysts offering 12-month price forecasts for Netflix Inc. have a median target of 402.50, with a high estimate of 525.00 and a low estimate of 175.00. The median estimate represents a +15.50% increase from the last price off 348.49.
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