Netflix is anticipating a loss of subscribers after its next planned price hike.
According to The Sun, the popular streaming service is expecting a “modest short-term churn" in subscribers across its services in the United Kingdom, the United States, Brazil, Mexico, and parts of Europe as it continues to hike the price of its various subscription tiers in the name of producing more original content.
“We are testing slightly different prices to better understand how members value Netflix,” the streaming services said in a statement to the outlet. “Not everyone will see this test and we may never roll out these specific prices beyond this test. Our goal is to ensure that Netflix is always great value for money."
Netflix added that they “don't anticipate that these new entrants [other streaming services] will materially affect our growth” in the long-run, though they do expect to see a fall in existing customers who already pay for memberships in April and June, when the price increases are set to be implemented.
In the United Kingdom, where the basic package currently costs £5.99 (roughly $7.80), the standard £7.99 (roughly $10.40), and the premium £9.99 (roughly $13), subscribers could be charged up to an additional £3 (roughly $3.90) per month, or up to £36 (roughly $46.85) a year.
It is expected that the number of new subscribers will fall by eight percent to 5 million subscribers in as a result of the increases compared to the 5.4 million that had subscribed to the service this time last year.
In the United States, the streaming service recently rolled out a price increase of either $1 or $2, which saw the basic package jump from $8 to $9, the standard from $11 to $13, and the premium from $14 to $16.0comments
The service has claimed the revenue from the price hikes will go toward producing more original series and films, though the increases have largely been slammed by subscribers who have threatened to cancel their subscription should the streamer continue with more price hikes.
Netflix’s decision to continue increasing the price of its packages, even if just by a few dollars at a time, comes as it faces fiercer competition in the ever-expanding field of streaming services. Hulu recently dropped its basic ad-supported plan to $5.99 per month, and in November, customers will officially be able to subscribe to Disney’s new streaming service Disney+, which will cost just $6.99 per month or $69.99 a year.