Netflix. It’s kind of a big deal.
It has 50 million subscribers.
It services 40 different countries.
It has one of the highest quality digital content libraries around.
It’s total revenue for Q2 2014 alone clocks in at $1.14 billion.
It makes Orange is the New Black.
It makes House of Cards.
Even the World Cup couldn’t stop it, with Reed Hastings, Netflix CEO insisting viewership did not drop off during the tournament, even in Brazil itself!
Given all this, if you were of the impression a price hike would hurt Netflix financially, you were of a wrong impression. Decidedly.
During Netflix’s Q2 2014 conference call, Hastings commented,
"I think we've seen really the impact of the price change go through already… It's pretty nominal, both in terms of acquisition, which in principle becomes a little bit harder because of the roughly $1 higher prices, or in retention, which, you know, could be a hair better from the grandfathered subs… But it's only a dollar difference, so I really think it's background noise, which is what we want it to be… We want to think what we do is we're steadily improving the content and the growth and the word of mouth, and that when we make a small change in price and handle it appropriately it really makes no noticeable effect on business."