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Industry Analyst Says a Netflix Price Increase Is ‘Likely’ Soon

September 28, 2020 | Posted by Jeremy Thomas

Netflix could well increase its subscription prices soon in the eyes of a prominent Wall Street analyst. Deadline reports that Alex Giaimo of Jefferies predicts a likely bump in subscription price from the streaming giant, noting that the company changed its verbiage regarding pricing from the Q1 earnings call in April and the Q2 call in July. Giaimo wrote a note to clients saying that he expected a price increase soon and noting, “In Q1, Netflix said that they were ‘not even thinking about price increases,’ while the Q2 language was more open-ended.”

Giaimo said that an increase of $1 to $2 per month in North America or Europe could generate $500 million to $1 billion in fiscal 2021 revenue for the service, saying that an increase of $1 to $2 a month in Europe, Middle East and Africa) as “most likely.” He estimates that it would add “an incremental $700 million to 2021 revenue.”

The service will reports its Q3 earnings on October 20 and has been surging in the pandemic, with 26 million new global subscribers in the first half of 2020 and a total subscriber base of 193 million. At the same time, it is dealing with an increasingly crowded marketplace for streaming that is now populated by the likes of big services such as Disney+, Amazon, HBO Max, and Hulu along with smaller specialty services like Criterion, Shudder, WWE Network and the like.

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Netflix, Jeremy Thomas