Netflix Executives Address Price Hike

Megalith

Megalith

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Netflix CEO Reed Hastings and CFO David Wells defended a recent price hike for subscribers on the streaming service, pointing to an increase in content and value that comes at an additional cost: the issue is that with increased content, Netflix has to charge a fair offering that matches the value of the company. “Price is all relative to value,” Hastings said. “We’re continuing to increase the content offering and we’re seeing that reflected in viewing around the world.” Netflix gained 5.3M global subs in Q3 and will release 80 films in 2018.

Hastings said that Netflix is going to “take the spending up next year,” by growing its leadership team and expanding content. In the company’s third quarter shareholder letter, company executives confirmed they would spend between $7 and $8 billion on content alone. To put that into perspective, Netflix spent approximately $6 billion on original content in 2016 and is expected to spend close to $7 billion in 2017. That’s an increase of $1 billion that will go to licensing exclusive series and developing more original content.
 
I think Netflix can pass on price increases because everyone just has this on auto bill pay. I don't even know what it costs a month although I am constantly tempted to cancel because the thumbs up/down thing pisses me off so bad. Trying to find something to watch and it just says 70% match, 95% match. WTF does that even mean?
 
OregonLAN said:
Netflix is still a bargain. Honestly, if they want to charge a couple more bucks a month to leverage better content, I'm OK with it...
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Same here. My family uses and abuses Netflix. I'll gladly pay a few extra bucks.
 
I'm ok with the price increase. The content they offer and the things they continue to pursue are top quality. Plus, no ads.

For that said I sent a big fuck you to Hulu and dropped their service.
 
While it's still in impulse buy range for me, I'm not fond enough of their own content to stay on if they keep increasing the price without using the additional money to secure/re-secure content from other providers. Losing all of the Disney empire's content is going to be a pretty big blow towards how much value they have for me, fairly soon.
 
Netflix is so fantastically ahead of other streaming services it's absurd. While they were originally just a platform for other content, they saw the writing on the wall early and saw that their own content would eventually have to stand alone, and man have they hit it out of the park.

I used to hi-jack someone elses account to watch, but i'll be getting my own once Stranger Things S2 starts.

What will happen is, once everyone gets their own 'platform' we will see market cannibalization because not everyone is going to want to pay 10 individual providers. I imagine some of these platforms will die and Netflix will probably pick up more external content in a few years.
 
Decided to drop my sub from 4k to HD plan because of this increase. I like Netflix, but I'm not buying their reasons for increase given all these extra subs they keep boasting about. If they keep increasing prices, I'll start doing the old cancel / renew when they have stuff we want to watch and check out other streaming options in between.

They will keep increasing prices as long as people are willing to pay for it, as much as the market will bear in fact... Has nothing to do with anything else.
 
I am never happy to see things are going up mails... but being Netflix Its cool up to about $20 bucks. (I really hope it doesn't go up that much... but I would pay it) The amount of use I get out of it between my wife daughter and myself is absurd. I used to run down to Blockbuster and drop $15-20 bucks on movies for the weekend fairly regular. The amount of viewing I get for 12 bucks Canadian is insane in comparison. I remember back in the blockbuster days hearing about this online video watching being the future and thinking that sounded insane. Considering what I do for a living I should have known that is exactly the way it would go... kudos for Netflix for seeing it well before anyone else did.

They also saw the need to build out their own content. They nailed that as well well ahead of everyone else. Yes some of Netflixs own content isn't my cup... but I have always been surprised at what my wife and kids have decided they liked. Netflix has done a great job of checking off everyones boxes.

As Thatsagood says in a few years or less there will be an influx of returning content as the too late to the party streaming competition start folding up and strike up new Netflix deals. As I see it though I may just not care. The number of shows worth watching on other networks/platforms seems to drop all the time... and frankly at the rate Netflix have been expanding their own content I am starting to have a hard time keeping up anyway. If I always have 5-6 Netflix shows to get to why do I really care about the late to the game sub par stream options.
 
Man, considering how much Netflix allowed me to abuse shared accounts and stuff I just don't mind at all the price increase. I generally really like their original programming and I am happy to see more of it on the way.

The only downside is the HORRIBLE THUMBS UP THUMBS DOWN interface but oh well.
 
I watched the first episode of Big Mouth - funny show. It's a Netflix original. (It's raunchy - don't let the kids watch it.) I've been pretty happy with Netflix over the years. Make some good content, even better.
 
So what if eventually they add so much content it costs as much as cable?
 
Netflix is nice but wish I could filter out a lot of the foreign flix as I have no desire to watch or read those movies
 
Ultima99 said:
So what if eventually they add so much content it costs as much as cable?
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I doubt it ever gets that expensive unless they crack the live sports nut.

Plus if you're not able to get Disney or other studio's content on Netflix and have to subscribe to their streaming services too, it'll look less than competitive versus the other $10-15/mo offerings.
 
deton8 said:
I doubt it ever gets that expensive unless they crack the live sports nut.

Plus if you're not able to get Disney or other studio's content on Netflix and have to subscribe to their streaming services too, it'll look less than competitive versus the other $10-15/mo offerings.
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Or just suck it up... watch nothing but Netflix and shun the Disney, CBS, ect ect content for a year or two. If enough people do the same all those late to the party providers will fall flat and crawl back.

Netflix is doing their best to make that easy. Stranger Things, BoJack, Mindhunter, Master of None, Narcos, The marvel shows, Ozark, OA, Glow, Crown, ASOUE... those are just off the top of my head full on originals. They have also been getting into co-production in a big way. Shows like Dirk Gently, the last kingdom and other BBC/Netflix projects. Netflix just announced a bunch of extra money to produce Canadian content, and the last year or so they had already been signing lots of co-production deals with Canadian production houses. Over the next few years I expect a ton of great material from co-productions in the UK / Australia / Canada / Mexico and others should make its way to US netflix. Much more interesting programming then the same old same old stuff we have been getting for so long.
 
Briteball said:
Netflix is nice but wish I could filter out a lot of the foreign flix as I have no desire to watch or read those movies
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While I think you're missing out on a lot of great content, I agree Netflix should provide a better means of tailoring the suggested movies and allowing filters and such.

And like most of the rest of the crew, my family uses and abuses Netflix, and my subscription is going nowhere soon. If any shows I want to see are not available, I'll wait for them to come to the public library before I pay for another half-dozen other streaming services.
 
Yeah, just in the last year I've gotten hooked on several new shows. Big Mouth was a screamer, and Love has been entertaining, and Iron Fist has surprising depth. I'm looking forward to watching Castlevania and Dirk Gently (actually on Hulu here in the States), as well as season two of Stranger Things. Still way more than I have time to watch.

And they have three upcoming series that sound interesting: Godless, Disenchantment, and Everything Sucks. And there will probably be another season of 3% in 2018.

I will gladly pay the asking price. No other premium network has even half this much content I enjoy.
 
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OregonLAN said:
Netflix is still a bargain. Honestly, if they want to charge a couple more bucks a month to leverage better content, I'm OK with it...
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Still a bargain for now. They will keep increasing the price until it is no longer a bargain. Baby steps.
 
OregonLAN said:
Netflix is still a bargain. Honestly, if they want to charge a couple more bucks a month to leverage better content, I'm OK with it...
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That's how it has historically happened with cable/satellite.

Each year increase by a few bucks, a few bucks, a few bucks, next thing you know you're paying $100/month for what effectively is the lowest tiered package you can get without going OTA.
 
sfsuphysics said:
That's how it has historically happened with cable/satellite.

Each year increase by a few bucks, a few bucks, a few bucks, next thing you know you're paying $100/month for what effectively is the lowest tiered package you can get without going OTA.
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But basic cable was never this cheap. Even in the 1980s we paid $25/month.

During the 2000s, you would pay the same for Showtime as you pay now for Netflix. It's a complete sea-change in pricing, even if you buy 3-4 of them!

Right now HBO defines the top-limit for streaming networks, at $15 a month. Netflix is still well below that limit.

Prices will ALWAYS rise. BUT the major difference here is: there's always someone willing to undercut you in streaming land to gain market share and notoriety. So I'd expect something closer to the promotional cable packages companies give in areas with actual competition, with companies buying-up rights for popular shows, and daring to dip their prices lower.

And Companies will actually talk about costs of production and units produced as part of their advertising (like this Netflix piece), unlike locked-down cable. So you can have some clue of where your money is going.
 
Not really a Netflix fan since they removed the old shows I liked, I have access to Netflix tho and the new show Mind Hunter looks pretty good.
 
If you want netflix to survive, you have to be okay with this price hike. They have negative cash flow, that means they are losing money ("profits" are meaningless)
 
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