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Will The Netflix Price Increase Affect Canada?

Will The Netflix Price Hike Affect Canada?

Netflix announced Monday that it will be raising prices for new members by the end of June. So will the change affect users in Canada?

HuffPost Canada reached out to Netflix to find out, but the streaming service was unable to provide details.

All we know is what the company said in its letter to shareholders Monday.

"In the U.S. we have greatly improved our content selection since we introduced our streaming plan in 2010 at $7.99 per month. Our current view is to do a one or two dollar increase, depending on the country, later this quarter for new members only. Existing members would stay at current pricing (e.g. $7.99 in the U.S.) for a generous time period. These changes will enable us to acquire more content and deliver an even better streaming experience."

So it all hinges on "depending on the country."

Two facts point to a high likelihood that prices in Canada will be going up.

First, Netflix already raised the price of its service in Ireland from €6.99 to €7.99 per month for new members earlier this year, a move which the company said has had a "limited impact." If it worked in Ireland, there's no reason to think it wouldn't work in Canada as well.

Secondly, Netflix is a bargain in Canada right now, at least in comparison to the price differences we see for other products and services. The streaming service costs $7.99 per month in Canada, the same price as in the United States. But since the U.S. dollar is worth considerably more, Canadians are actually getting the service at a discount.

Of course, Netflix offers more titles in the U.S. than in Canada, a result of the complex licensing environment for movies and TV. Even still, it's rare for products to be priced identically in both markets.

Even if prices do go up in Canada, the change likely won't affect existing members for quite some time. In Ireland, existing users were locked into their original rate for two years.

Netflix has hinted in the past that it will introduce tiered pricing at some point in the future. While all users would continue to get access to the full Netflix library in their respective countries, the different plans might offer varying numbers of simultaneous streams or other special features. The company is currently testing different options.

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