Netflix came in front to refute the claims of its customers by saying that the announcement of price hike was already made in 2014. The company reminded again in January in a note to its shareholders
Last week the news started to emerge that the US streaming business Netflix Inc. is all set for a price hike once again for its standard streaming plan. Previously, the streaming giant raised prices back in May 2014 where new customers were asked to pay $9.99 for standard two screen at a time plan where as the existing customers were exempted from paying the new increase prices. For the existing customers, those were the golden times which are now about to end. And it seems as the customers are not happy with the change Netflix is coming.
A couple of days ago it was believed that the streaming giant has come up with this decision all of a sudden which means that the streaming subscribers had no idea what they will be facing in the coming month. Analysts said that the price hike should not concern the viewers as the demand for Netflix’s original programming is soaring. A report published by JP Morgan Chase & Co. showed that 80 percent of the affected subscribers are not aware of the price hike.
Analysts stated that 17 million customers which are accountable to 37 percent of the total customer base of the United States will face price hike. And they believe that the streaming service provider should have informed before officially announcing this. However Netflix refute this and said it disclosed about the $2 price hike back in 2014. The company believes that the subscribers did not pay attention when it made the announcement. Many customers criticized the US streaming business on Twitter. The users said:
“Hey @netflix any plan on giving us more content with your price hike? It's pretty garbage at the moment.”
“Nope, sorry netflix, I haven't gotten a 25% raise in the last two years, so I won't be staying on for the price increase. Later.”
On the other hand, one customer was not much concerned about the price hike but expressed disappointment on not receiving any mail regarding this change but reading it on a news site. But it is the other way round. Netflix did inform the subscribers 2 years ago and reminded the shareholders once again in a letter sent to them in January. The company said, “In Q2 and Q3, we'll be releasing a substantial number of our US members from price grandfathering on the HD plan and they will have the option of continuing at $7.99 but now on the SD plan, or continuing on HD at $9.99 a month.”
The new price for the standard plan would become effective from next month which it previously announced in 2014 for the new customers who had to pay $8.99 instead of $7.99. At that time, Netflix reprieved the existing customers from paying the increased prices however mentioned that those will have to pay more after two years.
The spokeswoman of the company said in an interview with CNBC, “Later this month, members in the UK will begin to be un-grandfathered. Beginning [in] May, the price update is rolling out elsewhere based on member billing periods. Impacted members will be clearly notified by email and within the service, so that they have time to decide which plan/price point works best for them.”
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