Netflix is testing a price increase in monthly charges for the streaming service’s subscribers in Australia.
On Monday, the company revealed that it recently tested higher subscription fees for new customers Down Under. Netflix expanded to Australia in 2015 and has raised the prices for new subscribers by as much as three Australian dollars (AU).
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Netflix’s test resulted in a select group of Australian customers seeing price increases for the company’s “Basic plan” (going from AU $8.99 to AU $9.99 per month), while Netflix’s “Standard plan” was jacked up from AU$2 to AU $13.99, and the “Premium plan” increased AU $3 to AU $17.99 per month, according to The Australian.
Netflix confirmed the price hike tests in a statement this week. However, the company did mention that there are no permanent plans to indefinitely implement the policy in Australia or other places.
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“We continuously test new things at Netflix and these tests typically vary in length of time,” a Netflix spokesperson said. “In this case, we are testing slightly different price points to better understand how consumers value Netflix. Not everyone will see this test and we may not ever offer it generally.
The first tests were reportedly only going to be implemented on weekends. However, Netflix denied that this was going to be the case. A spokesperson for the company said in an email to Fortune that “these tests vary in length, they are not weekend only.”
It’s possible that Netflix introduced the temporary price hike as a response to the Australian government’s decision to place a 10% goods and services tax to cover “intangible supplies,” such as digital content and streaming services. The tax will come into effect on July 1 and will have an impact on companies like Netflix, hence why the tax has been nicknamed “The Netflix Tax.”
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This isn’t the first time that Netflix has upset subscribers by increasing the prices. In recent years, the company upped the subscription fees for users in the U.S. and abroad. Even though the subscribers were given notice well in advance of the price hike, the company still experienced a significant drop in canceled subscriptions.
Netflix was able to continue marching forward despite the canceled subscription and increase its user base close to 100 million global subscribers. In order to cover the increasing costs Netflix has with focusing on producing original content, the company will likely steadily raise its prices over time. In 2017, the company plans to spend over $6 billion to produce more than 1,000 hours of original movies and TV shows.
[H/T The Australian, BGR, Photo Credit: Julian O’hayon / Unsplash]
