To earn the maximum amount of points, I recommend responding in a 150 to 200 word response. Check it for spelling/punctuation and develop the draft in a word document. The reason I recommend this is because Canvas logs you out and you might lose the data while your word document may preserve it. Please do not summarize the article for me. I have read them. Instead, respond to the following prompt by using economic terms/concepts from the textbook. You can use your own experience to reflect how the articles relate to the chapter from the book and copy terms from the book. However, whenever you copy something exactly word by word, make sure you put parenthesis for example, "words".
Relate the following article(s) to either one of these concepts: elasticity, price elasticity of demand, income elasticity of demand, or cross elasticity of demand.
Now That You’re Hooked, Netflix Is Looking to Raise Its Prices Again:
But don’t worry, your weekend binge won’t cost you extra. By Joanna Robinson. May 16, 2017.
In the age of Peak TV, cord cutting, and too many media options, many pop culture–loving Americans have had to make some budgetary decisions. Gone are the days where everything you might want to watch is available in one bundled cable package—but when it comes to choosing which service to keep, Netflix often emerges as the best bang-for-your-buck option. There’s a new TV series to watch every weekend (sometimes more (Links to an external site.) than one (Links to an external site.)), and with plans ranging from $7.99-$11.99, it costs less per month than a single night out at the movies. But now that Netflix has hooked an audience on its never-ending supply of original content, the streaming service is curious to know how much you’ll really pay to stay plugged in.
A rather alarmist article from The Australian (Links to an external site.) indicates that prices are going up down under. The paper reported, and Netflix confirmed, that the streaming service has been running tests in Australia that increased the basic service from $8.99 to $9.99 a month, the standard service from $11.99 to $13.99 a month and the premium service from $14.99 to $17.99 a month. What The Australian got wrong, according to an emailed statement from Netflix, was identifying this price hike as a new “weekend surging” model. “Reports that we are testing ‘weekend-only’ pricing are inaccurate and entirely false . . . This testing varies in length and time and the fact that some members saw this test on a weekend is completely unrelated.” So no, neither you nor any Australian you know will have to pay more for enrolling in a Netflix plan on the weekend.
But Netflix admitted it is exploring charging more for its goods and services with this Australian test. The company, no doubt, wants to avoid a catastrophe similar to the one in 2011, when, after C.E.O. Reed Hastings (Links to an external site.) announced the short-lived (Links to an external site.) DVD-only service Qwikster and a potential 60 percent price hike for some customers, users rioted (Links to an external site.) and cancelled their subscriptions— causing Netflix stock to plummet (Links to an external site.). Back then, the company overplayed its hand—at the time, local video stores hadn’t yet been driven out of business, and the addictive likes of Stranger Things, Orange Is the New Black, Jessica Jones, and more were just a glimmer in TV-lovers eyes. Netflix’s first original series, House of Cards, didn’t launch until 2013.
What a difference a few years make. In 2015, after Netflix had made itself even more valuable to customers thanks to the rise of binge-watching and the 2013 demise of Blockbuster (Links to an external site.), the company attempted again to raise its prices. This time, the hike was much gentler—a mere dollar increase (Links to an external site.) in most cases rolled out gradually—and Netflix users took the change docilely, (for the most part (Links to an external site.)). That’s what happens to frogs in a pot of hot water when you turn up the temperature slowly.
So in Australia, Netflix is doing what it has done many times before in other countries: seeing what the market will bear. Fortune (Links to an external site.) speculates that the company may be exploring a significant price surge in Australia specifically (and, Netflix stresses, this is exclusively an Australian test) because of a “recent decision to extend the federal government’s 10 percent goods and services tax to cover ‘intangible supplies,’ including digital content and streaming services like Netflix. Nicknamed the ‘Netflix Tax,’ the extended tax will start affecting companies like Netflix when it goes into effect on July 1.”
Having assured its customers that weekend surge pricing is not a thing, Netflix further clarified in an emailed statement to Fortune: “We continuously test new things at Netflix and these tests typically vary in length of time. In this case, we are testing slightly different price points to better understand how consumers value Netflix. Not everyone will see this test and we may not ever offer it generally.” May not—but after a decade of rock-bottom pricing on streaming content and establishing a firm stranglehold on pop culture (Links to an external site.) (not to mention an expansion into the world of filmmaking), Netflix has no reason not to make you pay. http://www.vanityfair.com/hollywood/2017/05/netflix-raising-prices-weekend-surge-pricing (Links to an external site.).
Netflix surges 15% to record high after blockbuster earnings show company added more subscribers than forecast
By Theron Mohamed (Links to an external site.) Jan. 20, 2021, 12:33 PM
Netflix (Links to an external site.) shares jumped as much as 15% on Wednesday, after the entertainment titan trumpeted its cash generation and teased stock buybacks in fourth-quarter earnings that surpassed Wall Street's expectations (Links to an external site.). The rally added up to $34 billion to its market capitalization.
The video-streaming service - the world's largest - added a record 37 million paid subscribers in 2020, boosting its global members by 22% to more than 200 million for the first time. Its annual revenue surged 24% to $25 billion as a result, driving its operating income up 76% to $4.6 billion.
Netflix also reduced its free cash outflow from $1.7 billion in the fourth quarter of 2019 to $300 million last quarter, and expects it will shrink to around zero this year.
The group's bosses expect the stronger cash generation will allow them to finance everyday operations without tapping debt markets anymore. They will also explore returning cash to shareholders via stock buybacks.
Netflix counts chess drama "The Queen's Gambit," period drama "Bridgerton," and season four of "The Crown" among its recent hits. It has borrowed more than $16 billion over the last decade to build its library of TV shows and movies, The New York Times said (Links to an external site.).
The streaming company has been one of the few beneficiaries (Links to an external site.) of the COVID-19 pandemic. Signups surged last year as lockdowns and travel restrictions forced millions of people to spend more time at home, and government closures of gyms, stores, and restaurants severely limited their leisure options.