Netflix More Fully Embraces Streaming Video
Netflix (NFLX) shares are up around 7% today, to around $185, after the mail-order and online movie-rental company said it's shifting its focus to streaming video and raising the prices of some of its subscription plans, the Associated Press reported.
The company has previously announced that its members are increasingly watching more content streamed over the Internet than on DVDs, thanks to widespread high-speed online access and different gadgets that make it easier to connect your TV to the Internet. Netflix said its introducing its first streaming-only subscription plan in the U.S. for $7.99 a month.
In late September, it launched this service in Canada for C$7.99 a month, and it recently said the service has surpassed initial expectations and encouraged it to accelerate plans for further international expansion in 2011.
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"We are now primarily a streaming video company," co-founder and CEO Reed Hastings said in a statement. Netflix says it will spend heavily to obtain the streaming rights to more movies and TV shows.
Netflix's other subscription plans will go up for existing members in January but immediately for new sign-ups. The subscription plan for unlimited movies and TV shows streamed over the Internet and unlimited DVD deliveries, with one DVD out at a time, will increase by $1 a month to $9.99. Prices for other plans allowing for more DVDs out at a time are also going up.
Netflix has more than 16 million members in the U.S. and Canada, and predicted it could enter 2011 with more than 19 million subscribers, doubling the service's size in two years.
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