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Netflix may Raise Price Up to $2 a Month for New Subscribers

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Netflix?s gains surged in the first quarter, saying that it had contained the costs and had signed up more international subscribers than predicted. The online video service also said that new U.S. ?subscribers may experience a $1 to $2 increase later this quarter.

Increased Rate for New Members Only

This would be the company?s first price hike since 2011 in the U.S, which sparked outrage with an increase of 60 percent. The price increase also follows Amazon?s move this year, increasing the price of its Prime service from $79 to $99 annually. Netflix, who aims to become the world?s first online television network, relies on the U.S for most of its business.

However, the company has set the green light on its plans to expand significantly abroad this year and boost its original programming. Netflix?s strategy not only shows its hunt for fast growth, but also its ambition to be a must ? have global TV.

“House of Cards” Gathered Huge Audience in February

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Chief Executive Reed Hastings said in his letter to shareholders the strengthening of his rhetoric combination of his desire for no ? fee deals that improved Netflix?s ISP network access. Hastings said that the company opposed the merger of Time Warner Cable and ComCast because it is a threat to its business interests.

The letter highlighted the success of ?House of Cards? season two. It is Netflix?s plan to use original series as key in becoming a dominant TV network. Shows like the ?House of Cards,? which debuted last quarter, and ?Orange is the New Black? have been considered as hits. Netflix said the February debut of ?House of Cards? gathered a huge audience, but the second season had more viewers than the first.

Europe Expansion Plans

Netflix revealed its plans earlier this year for an expansion in Europe. The company said its international operations are on track to gaining profits this year. However, the expansion plan in Europe will continue to bring loss this year.

The company is projected to gain 940, 000 international members and 520, 000 domestic ones in the second quarter. Hastings said he envisions Netflix reaching 60 to 90 million U.S customers one day. Overall, the company profited over $53.1 million (86 cents/share), compared with last year?s $2.7 million (5 cents/share).

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