UPDATE: Netflix is raising the cost of subscriptions again

10/06/17 08:53 AM EDT

By Trey Williams, MarketWatch

Netflix plans to spend $7 billion on content in 2018, up from $6 billion this year

A Netflix subscription just got a bit more expensive.

The streaming giant on Thursday raised the price of two of its memberships. The popular two-screen high definition subscription now costs $10.99, up from $9.99, and the plan allowing users to watch on four screens and in ultra-high definition was increased to $13.99 from $11.99.

The lowest tier subscription is staying at $7.99 a month.

Netflix (NFLX) shares were up more than 3% after the hike on Thursday.

Tests by MarketWatch staffers show there was no increase listed for customer's current plans.

"From time to time, Netflix plans and pricing are adjusted as we add more exclusive TV shows and movies, introduce new product features and improve the overall Netflix experience to help members find something great to watch even faster," the company said in a statement.

Read:Netflix might add more subscribers than expected in the third quarter (http://www.marketwatch.com/story/netflix-might-add-more-subscribers-than-expected-in-the-third-quarter-2017-10-04)

Also see:Netflix wants exclusive rights to films, TV shows and the talent creating them (http://www.marketwatch.com/story/netflix-wants-exclusive-rights-to-films-tv-shows-and-the-talent-creating-them-2017-08-16)

Netflix said the increase is for new members in the U.S., and it plans to start letting current members know about increases on Oct. 19, at least 30 days before they can expect to see an increase.

The price change will roll out over the next several months.

Since the last price increase in 2015, which led to subscriber losses (http://www.marketwatch.com/story/netflix-price-increases-causing-subscribers-to-sign-off-2016-07-18), Netflix has invested in a download feature and interactive content. The company also continues to spend more and more to ramp up its original content.

Netflix chief content officer Ted Sarandos said recently that the company, which already outspends its competitors, is planning to spend $7 billion on content in 2018, up from $6 billion this year and $5 billion a year ago.

Check out:Can 'Star Trek: Discovery' help make CBS's stand-alone streaming pursuit successful? (http://www.marketwatch.com/story/can-star-trek-discovery-help-make-cbss-stand-alone-streaming-pursuit-successful-2017-10-04)

Analysts say Netflix has room to increase subscription costs. Time Warner Inc.-owned (TWX) HBO's streaming service, for example, costs $15 a month.

Netflix shares have gained nearly 54% in the year to date, while the S&P 500 index is up nearly 14% and the Dow Jones Industrial Average is up close to 15%.

-Trey Williams; 415-439-6400; AskNewswires@dowjones.com

 

(END) Dow Jones Newswires

10-06-17 0853ET

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