Despite price hikes, here’s why Netflix may offer best value in streaming

It’s less than six months since Netflix’s last price hikes, but according to the latest scuttlebutt, you might need to buckle up for another.

There’ll be more subscription cost increases by the end of 2024, according to an analyst reported by Variety. In a note to investors, John Hodulik of UBS, said “we expect to see rate increases this year” by Netflix.

Hodulik says the company would look to capitalise on its increasing power in the TV landscape with its share of the overall US TV ratings. The ratings service Nielsen reckons Netflix had 7.9% of all viewing in the US in January. That was up from 7.7% in December.

While Netflix is priced higher than many of the other streaming services in the United States overall, the analysts reckons it costs subscribers less per hour viewed than any rival platform.

The analysts say Netflix subscribers pay around 30¢ per hour of content they consume, while Disney+ subscribers pay around 73¢ per hour. Among the others, Max and Paramount+ subscribers pay around 81¢ per hour, for Peacock it’s 58¢ and for Hulu it’s 56¢.

So, with all that mind, Netflix may have a little more wiggle room to push prices farther than the £2 and $3 it raised prices by in October last year. In the UK, for instance, the most expensive Premium plan £17.99, while it costs $22.99 in the United States.

“The new playbook includes 1) price increases, 2) platform consolidation, 3) library curation (with attendant asset write-downs), 4) cuts to content spending (adjusting for strike-related declines in 2023) and 5) a renewed focus on content licensing,” the note to investors read.

“As the objective in streaming shifts from subscriber growth to profitability for the traditional media companies, we see Netflix as the ultimate beneficiary of this industry rationalisation.”