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Could more price hikes be coming to Netflix this year? Analysts think so
Evercore ISI senior managing director Mark Mahaney discusses Netflix’s market performance and why Google is risky.
Netflix binge-watching could soon get even pricier.
It could happen if the streaming giant decides to hike how much it charges for its memberships again and, according to UBS telecom and cable analyst John Hodulik, that may very well be in the cards this year.
UBS “expect[s] to see rate increases this year” that will drive average revenue per membership up by 5% with help from “scaling ad revenues,” he said in a recent research note. FOX Business reached out to the company for comment.
BRAZIL – 2023/12/05: In this photo illustration, the Netflix logo is displayed on a smartphone screen. (Photo Illustration by Rafael Henrique/SOPA Images/LightRocket via Getty Images / Getty Images)
Netflix currently has the monthly fees for its ad-free Standard and Premium plans set at $15.49 and $22.99, respectively, for its U.S. subscribers while its Standard with Ads plan costs $6.99. The streaming giant also has a $11.99-per-month Basic tier that it is sunsetting that “is no longer available for new or rejoining members,” according to its website.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| NFLX | NETFLIX INC. | 619.34 | +16.42 | +2.72% |
The basic and premium options reached those cost levels last year in the U.S. after Netflix announced price hikes – $2 for the former and $3 for the latter – back in mid-October, as FOX Business reported at the time. The company rolled out higher prices for those in the U.K. and France too.
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“While we expect net adds to slow, we believe Netflix still has significant runway as it continues to convert users to paid subs and attract new cohorts,” Hodulik went on to say in the research note. “This, along with price increases and a ramp in the advertising platform should drive accelerating growth in ‘24 … or 13% CAGR through ‘27.”
UBS projected revenues for the streaming giant – a “Buy” in their eyes – could hit 15% growth this year, according to the research note.
PARIS, FRANCE – FEBRUARY 13: In this photo iIllustration, the Netflix logo is seen on the screen of an iPhone in front of a computer screen showing a Netflix logo on February 13, 2019 in Paris, France. Netflix, the US giant of online video subscripti ((Photo by Chesnot/Getty Images) / Getty Images)
About a month prior to the note, Co-CEO Greg Peters told analysts and investors the company “largely put price increases on hold while we were rolling out the paid sharing work because we saw that as a form of substitute price increase.”
“Now that we’re through that, we’re able to resume our sort of standard approach towards price increases,” Co-CEO Greg Peters said at the time, adding the company would “continue to then monitor other countries and try to assess when we’ve delivered enough additional entertainment value” to warrant increases.
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The company has previously said that “as we invest in and improve Netflix, we’ll occasionally ask our members to pay a little extra to reflect those improvements, which in turn helps drive the positive flywheel of additional investment to further improve and grow our service.”
Netflix’s total subscriber count included 260.28 million people around the world as of the end of the fourth quarter. In the same three month period during the prior year, it was 230.75 million.
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Users of other streaming platforms also saw those subscriptions become more expensive in 2023.
The logo of the streaming service Netflix can be seen on a television. (Thomas Trutschel/Photothek via Getty Images / Getty Images)
In mid-October, for example, Disney officially upped the per-month charge for its ad-free Disney+ and Hulu standalone subscriptions by $3. The cost of subscribing to the Apple TV+ streaming service also went up by $3 that month after having been $6.99 since October 2022.
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As we look ahead to 2024, many homeowners and prospective buyers are wondering what to expect when it comes to mortgage rates. The landscape of the housing market is constantly changing, so it’s important to stay informed about trends and predictions. In this blog post, we will discuss some factors that could impact mortgage rates in 2024 and what homeowners and buyers can expect.
One factor that could impact mortgage rates in 2024 is the overall state of the economy. If the economy is strong and growing, we may see higher mortgage rates as the Federal Reserve looks to combat inflation. On the other hand, if the economy is stagnant or in a recession, we may see lower mortgage rates as the Fed looks to stimulate growth. It’s important to keep an eye on economic indicators such as GDP growth, unemployment rates, and inflation to get a sense of where mortgage rates may be heading.
Another factor that could impact mortgage rates in 2024 is Federal Reserve policy. The Fed plays a key role in setting interest rates, and their decisions can have a ripple effect on mortgage rates. If the Fed decides to raise interest rates in response to inflation, we may see an increase in mortgage rates. Conversely, if the Fed decides to lower interest rates to stimulate growth, we may see a decrease in mortgage rates. Keeping up with the latest news and announcements from the Fed can give homeowners and buyers a sense of where mortgage rates may be heading.
In terms of specific cities and local mortgage companies, it’s important to note that mortgage rates can vary depending on location and lender. For example, in a city like New York City, where real estate prices are high, mortgage rates may be higher compared to a city like Indianapolis, where real estate prices are lower. Additionally, local mortgage companies may offer competitive rates and terms compared to national lenders. For example, in New York City, local lenders like Quontic Bank and CrossCountry Mortgage may offer specialized products and services tailored to the needs of local buyers.
It’s important for homeowners and buyers to shop around and compare rates from multiple lenders to ensure they are getting the best deal. Websites like Bankrate and LendingTree can be helpful resources for comparing rates and terms from multiple lenders. Homeowners and buyers should also consider working with a mortgage broker who can help them navigate the lending process and find the best mortgage product for their needs.
In conclusion, predicting mortgage rates in 2024 is not an exact science, but there are several factors that could impact rates. By staying informed about economic indicators, Federal Reserve policy, and local market trends, homeowners and buyers can make informed decisions about their mortgage. Shopping around and comparing rates from multiple lenders is key to ensuring you are getting the best deal on your mortgage. Whether you’re looking to refinance your existing mortgage or buy a new home, it’s important to stay informed and be proactive in managing your mortgage.
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