By: Alyssa Saunders

People keeping their eye on stocks might have noticed the plummeting price of Netflix in the past few weeks. This is due to the news that Netflix lost subscribers in droves recently. Why? Because they refuse to pay $9.99 monthly, versus the $7.99 most customers were paying for the past two years.

If you’re a true Netflix addict, a $2 increase won’t affect your decision to remain in the streaming service’s loving embrace. They even gave you fair warning several years back, allowing customers to hold on to their $8 prices a little longer. Sure you’re paying $24 more a year, but with quality original shows like Orange is the New Black and BoJack Horseman, and the addition of new great movies every day, why would a tiny increase bother you that much?

For passive subscribers who may not use Netflix daily, however, a somewhat small increase is a good excuse to jump ship before bigger charges start showing up. Let’s face it, a lot of the original shows Netflix produces are pretty damn expensive to make, either because of epic locales (Marco Polo, Sense 8) or big name stars that require big paychecks (House of Cards, Grace and Frankie). Add to that a tendency to continually renew shows regardless of criticism, and you’ve got a lot of money being spent. Media outlets were shocked to report that CCO Ted Sarandos wanted to spend $6 billion on content this year alone, so it’s hard to imagine them scaling back anytime soon. Many customers have given up cable because they can get plenty of content for less than $50 a month with an internet connection. So to see increases, even if they’re not sudden, starts bringing back memories of expensive cable bills. It’s easy to assume people terrified to pay a couple more dollars a month are scared because of what apocalyptic future could follow are completely wrong. But when billions of dollars are being thrown around, consumers are allowed to wear a tin foil and start believing in slippery slopes.

Of course, Netflix has to compete with the likes of Hulu, Amazon and other streaming services competing for your wallet, and in order to stay relevant they dip their toe in everything (a crime documentary here, a lucrative deal with Marvel there).  Netflix was once David, throwing rocks at Goliaths like traditional broadcast programming and Blockbuster. Now that they’ve become the giants of industry, they know what’s at stake and they don’t want to end up blinded and brought down by the little guy. So yes, they’re willing to lose some customers today to bring back even more in the future. Netflix should easily recover from this loss, and as long as they keep innovating and impressing, viewers will keep coming back.

What do you think about the price increase?

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