Netflix subscription rises above £20 a month for first time

Netflix has increased the price of its premium subscription package to above £20 for the first time.

The streaming giant this week quietly lifted the cost of a premium membership by £2 to £20.99 for UK subscribers.

A standard plan has risen by £1 to £13.99, while the cheapest ad-supported tier is now £7.99 – up by more than a third from £5.99.

Netflix said the price rises “reflect improvements to our wide range of entertainment and the quality of our service”.

The premium membership is Netflix’s most expensive package, allowing simultaneous streams on four devices, as well as 4K streaming. When introduced in 2015, the tier cost £8.99 a month.

A spokesman added: “Our approach remains the same: we continue offering a range of prices and plans to meet a variety of needs, and as we deliver more value to our members, we reinvest in quality entertainment and improve their experience by updating our prices.”

Netflix, which has more than an estimated 18 million subscribers in the UK, previously raised its prices in February last year. The changes apply to new and existing customers.

The price rises are the latest of several borne by subscribers to streaming services.

Research by Ampere Analysis in August showed that Western Europe experienced the biggest average monthly increases across all streaming services in the past three years, at $1.86 (£1.38) or 16pc.

This was more than the $1.70 increase that subscribers faced in the US, the world’s biggest streaming market.

Amazon Prime Video, Disney+ and Paramount+ have all increased their prices in recent years, with the latter increasing the monthly cost of its ad-free premium plan last year to £14.99.

At the same time, many of the streaming giants are expanding their cheaper, ad-supported packages as they seek to keep revenues growing.

This week’s increases also underscore Netflix’s pricing power even as competition in the streaming market intensifies.

Netflix is planning to diversify into new forms of media such as podcasts, gaming and short-form videos to stay ahead of its competitors. It is also exploring live sports and ad breaks, the staples of traditional broadcast television.

Britain’s traditional broadcasters in turn face growing pressure from Netflix and other streaming services for viewers and advertising revenue. In August, it emerged that Netflix’s UK sales eclipsed those of ITV for the first time.

The streaming giant’s revenue topped £2bn last year, while ITV’s broadcast and streaming division made £1.9bn.

The company reported global revenues of $12.6bn in the second quarter of this year and quarterly net income of $3.4bn.