According to CNBC, the changes take effect immediately for new customers signing up for Netflix, while current subscribers will be grandfathered in to their existing prices for now, and see the price hike emerge over the next three months. The increase represents a jump of between 13 percent and 18 percent, which is Netflix's biggest price increase since it launched streaming 12 years ago.
Today's report says that the extra cash will be used to pay for Netflix's lofty investment in original shows and films, as well as finance the debt it's recently taken on to "ward off streaming threats" from Apple, Disney, and others.
Netflix is boosting its original catalog of shows and movies as more companies remove their content from its service and build their own platforms, just like Disney will do with Marvel and Star Wars movies sometime this year. After they're removed from Netflix for good, Disney's streaming service "Disney+" will be the exclusive streaming home of these franchises.
Netflix is also gearing up for new competition in the streaming market, particularly from Apple's upcoming original television shows. Apple is planning to debut its first string of shows at some point in 2019, and they'll reportedly be free for Apple device owners in the company's TV app, likely taking some streaming time away from Netflix for users who stream on Apple TV.
In total, this is the fourth price hike for Netflix subscribers in the streaming service's history. The HD Standard tier was priced at $10/month in 2017 before it rose to $11/month in November of that year, and now it will be priced at $13/month.
During one of the first price hikes in 2016, Netflix CEO Reed Hastings noted that the company saw an "unexpected" loss of subscribers when raising the Standard tier from $8 to $10/month. "Whatever the price is for something, people don't like for it to go up," Hastings admitted at the time.