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Description: If you’re a Netfllix subscriber, get prepared to dig a bit deeper into your pocketbook. The monthly rate for the two-stream plans in Canada are heading to $16.49 from the current price of $14.99. Netflix asserts that the increase will help the company provide a “better experience” in a market that seems to be somewhat saturated with streaming sources.

Date:  January 14, 2022

Source:  cbc.ca

Link: https://www.cbc.ca/news/business/netflix-price-hike-1.6315677

1) How many of your classmates are Netflix subscribers? What other streaming services are you and your classmates subscribing to?

2) Have a discussion in your class about the plusses and the minuses of raising the fee. For example, will creating new offerings via the additional revenue draw new customers? Or, will Netflix lose customers who don’t like the rate increase?

3) Page 13-1 of Wiley’s Financial Accounting: Tools for Business Decision Making has a vignette discussing cash flows at Cineplex, noting that Netflix has placed a competitive challenge upon cinemas. In addition, Covid-19 has imposed an additional pressure on movie theatres. Search for the financial statements of Cineplex online, and, determine how cash flows have been impacted since 2020.

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