Watching the U.S.-based political drama TV series "House of Cards" on Netflix may soon get a bit expensive. The price increase, however, will affect only new customers but the question is will they mind?
On Monday, April 21, Netflix announced its financial results for the first quarter of 2014 ended March 31. The company reported strong financial results for the quarter, but also announced that it plans to increase the monthly subscription for new customers by $1 or $2 soon.
Netflix increased the monthly subscription fees of €6.99 to €7.99 in Ireland from January this year. The price increase has had a limited impact on the company.
"In the U.S. we have greatly improved our content selection since we introduced our streaming plan in 2010 at $7.99 per month. Our current view is to do a one or two dollar increase, depending on the country, later this quarter for new members only. Existing members would stay at current pricing (e.g. $7.99 in the U.S.) for a generous time period. These changes will enable us to acquire more content and deliver an even better streaming experience," per [pdf] Netflix.
Netflix has millions of subscribers worldwide and expects that it will sign up around 1.5 million new subscribers in the current quarter. Analysts believe that the price increase of around a couple of dollars will be quite substantial for the service that Netflix provides.
The first season of House of Cards debuted in February 2013 and attracted many customers. The company admitted that the second season of the TV series, which debuted in February this year, has helped Netflix increase its subscriber's base even more. The on-demand nature of the service means that customers can watch the current season, as well as other episodes when needed.
Netflix is one of the biggest on-demand Internet media streaming providers. The company is not the only one to increase the price of its online streaming services. Recently, Amazon also increased the price of its Prime service from $79 to $99 annually.
Netflix confirmed that its worldwide subscriber base has reached 48.4 million. The net income for the company in Q1 2014 was $53.1 million. Netflix also reported $1.28 billion as revenue for Q1 2014, which is a big achievement for the company as it posted a net loss of $1.8 million and revenue of $1 billion during the same quarter in 2013.
Netflix' stock closed at $348.49 on Monday, April 21, an increase by $2.75 per share. Following the earnings call the company's stock also reached $370 in the after hours of trading.
