Netflix Raises Prices in Some Countries as Growth Slows
Netflix is starting to raise prices in some countries as its growth, driven by cracking down on password sharing, begins to slow down. The streaming giant has already increased subscription fees in Japan, parts of Europe, the Middle East, and Africa over the past month, with changes in Italy and Spain now being rolled out.
In its latest results, Netflix announced that it added 5.1 million subscribers between July and September, exceeding forecasts but marking the smallest gain in over a year. The company is facing pressure to demonstrate to investors what will drive growth in the future, as acquiring new subscribers becomes more challenging due to its already massive reach.
To combat a previous slowdown in 2022, Netflix implemented measures to prevent password sharing and introduced a new streaming option with advertisements, which led to a surge in growth. The company has since added over 45 million new members and now boasts 282 million subscribers globally.
Despite the success of its ad-supported plan, which accounted for 50% of new sign-ups in certain regions, Netflix has stated that it does not expect advertisements to significantly drive growth until next year. The company’s revenue in the July-September period was up 15% compared to the previous year, reaching over $9.8 billion, with profits also increasing.
Analysts believe that advertisements could eventually become a significant source of revenue for Netflix. The company’s strong financial position allows it to continue investing in new content, such as the critically acclaimed series “Baby Reindeer,” created by and starring Richard Gadd, which recently won four Emmy Awards.
With competition in the streaming market intensifying, Netflix’s ability to offer compelling content will be crucial in retaining subscribers and justifying any future price increases.
