Netflix

How rapidly are Netflix price rises outstripping inflation?

Netflix price rises
Price rises: is Netflix running its own heist?

Last Updated on

Netflix is putting up its prices – again. The company was once renowned for freezing its prices, but customers on the Standard Plan are about to be hit with their third price rise in as many years.

I joined Netflix back in 2013, when the price was £5.99. Even though the company put up the price for new subcribers to £6.99 in 2014, it froze the price for existing subscribers as a “thank you”.

Gratitude now seems to have gone out of the window. Here’s how the Netflix price rises have been applied to my account since I joined.

March 2013£5.99
June 2016£7.49
November 2017£7.99
October 2019£8.99

That’s a 50% increase in price in six years, as the sharper mathematicians in the crowd are probably aware.

According to the Bank of England’s inflation calculator, inflation has averaged just 2.4% a year since 2013 (although those figures only go up to 2018, as the 2019 figures aren’t in). Accordingly, a £5.99 subscription in 2013 adjusted for inflation should cost £6.75 in 2018.

Even if we’re generous and assume inflation rises by 2.5% this year, pushing up the 2019 cost to £6.92, that’s still almost two quid higher than the rate of inflation. Or to put that another way, the new Netflix price is 30% higher than it would be if the price were merely adjusted for inflation.

Is there any way to beat the Netflix price rises?

The new £8.99 standard tariff isn’t the cheapest Netflix plan. There is £5.99 per month Basic plan, which isn’t going up in price this autumn.

That is, however, a pretty limited plan. You can only watch Netflix on one device at a time, as opposed to the two simultaneous screens you get on Standard. Worse still, picture quality is limited to standard definition. The Standard plan – somewhat counterintuitively – allows you to watch in HD. If you want Ultra HD (4K), that’s £11.99 per month.

So, Netflix is turning the screw, just as rivals from Apple (£5.99 per month) and Disney enter the market and investment experts warn that the company’s stock looks seriously overvalued. It’s brave, I’ll give them that.

NOW READ THIS: Did Netflix edit The West Wing?

About the author

Barry Collins

Barry has scribbled about tech for almost 20 years for The Sunday Times, PC Pro, WebUser, Which? and many others. He was once Deputy Editor of Mail Online and remains in therapy to this day. Email Barry at barry@bigtechquestion.com.

Add Comment

Click here to post a comment

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: