Netflix recently indicated that a subscription fees hike is in the pipeline for 2024.
Ads are coming to Netflix in 2024
This move comes as the company phases out its basic ad-free plan, pushing subscribers towards higher-tier plans or ad-supported options.
The cheapest ad-free plan will be discontinued in countries offering an ad-supported tier, beginning with Canada and the UK in Q2 2024.
This decision aligns with Netflix’s strategic shift to ad-supported streaming after years of relying solely on subscription revenue.
In its fourth quarter (Q4) earnings report, Netflix subtly hinted at this upcoming price increase.
The company has already barred new and returning customers from signing up for the ad-free basic plans, though existing customers can maintain their subscriptions for now.
This decision is seen as a step towards nudging subscribers to either accept ads or pay more for ad-free viewing.
As of now, Netflix US offers three pricing tiers: Ads at $6.99, Standard (HD) at $15.49, and Premium (4K) at $22.99.
However, these prices could rise, as Netflix rarely shies away from increasing fees.
From the company’s Q4 2023 earnings report, it’s evident that Netflix is in a robust financial position, having gained 13.1 million subscribers in that quarter alone, the highest ever for a single quarter.
This surge has taken its total subscriber count to 260 million worldwide. The ad-supported tier also saw significant growth, reaching 23 million subscribers, up from 15 million in November 2023.
The company’s revenue for Q4 2023 was an impressive $8.83 billion, surpassing Wall Street’s expectation of $8.7 billion. However, the earnings-per-share (EPS) fell short at $2.11, against the anticipated $2.28 per share.
Will Netflix increase subscription fees in South Africa?
To bolster its content library and justify potential price increases, Netflix has inked a deal with WWE. Starting January 2025, Netflix will exclusively host WWE RAW in the US, Canada, the UK, and Latin America.
The platform will also be the exclusive home for WWE events outside the US, including Wrestlemania and SummerSlam.
This move is part of Netflix’s strategy to offer more exclusive content, enabling them to charge more for their service potentially.
Despite these developments, the price hike might not affect all regions uniformly.
As of the latest reports, Netflix has not introduced an ad-supported tier or increased prices in South Africa.