The price of Netflix Inc.'s most popular streaming subscription plan has been raised by $1 to $9.99 a month, according to a report from Bloomberg.
The price increase is for Netflix to cover the costs of licensing shows and funding its original programs, which is growing in numbers.
Bloomberg adds that the new rates will instantly be applicable to new customers in the U.S., Canada, and parts of Latin America.
Existing customers will have a grace period that varies in length before the prices would reflect the increase.
The plan that was affected by the price increase is the plan that allows customers to watch at two screens at the same time, according to the Netflix's website.
The plans that allow customers to watch on one screen and four screens at the same time aren't won't be increasing their prices.
Bloomberg adds that customer gains and higher prices are what Netflix rely on to sustain its revenue growth and finance the cost of its TV and film offerings.
The company has $4.3 billion in programming cost over the next year and nearly $5 billion more for the following three years.
The Daily Nonpareil adds that the increase marks the second time in 17 months that Netflix has boosted its price in the U.S.
The company has been under financial pressure as it competes with Amazon.com, HBO, and other services for the rights to TV series and movies.
Netflix's price increase has also been little and gradual, a move that Reed Hastings, the CEO of Netflix, has been taking in an effort to avoid a customer backlash, according to The Daily Nonpareil.
More than 800,000 customers canceled their subscription after the company raised its rates by 60 percent in 2011 to subscribers who wanted Internet video and DVD-by-mail rentals.
The Daily Nonpareil adds that the experience has taught Netflix to reward its existing subscribers and phase in the new and higher prices to new customers.
Existing customers, who signed up with Netflix since May 2014, will still be paying $8 per month under the two-year rate freeze the company adopted in its last price increase in the U.S. Customer who signed up since the last price increase will pay $9 per month until Oct 2016.
