Can you still call it “Netflix and chill” when streaming is about to get expensive?
Reports say the impact of the US President Donald Trump’s initiative for increased tariffs on goods produced abroad is not limited to commerce and industry; it is also directly affecting your subscriptions.
Global behemoths like Netflix, which mostly depends on foreign productions, may be greatly impacted by the planned 100 percent levy on entertainment content produced elsewhere, according to Straits Times.
As history indicates, a rise in production costs will probably be passed on to customers. Netflix had increased its monthly plan pricing in April, claiming “changes to local taxes or inflation.”
Streaming corporations are increasingly caught in the crossfire of global policy shifts, both in content production and in technology infrastructure.
“Businesses are not going to charge US consumers significantly more than customers in other regions. The global pricing strategy will be affected,” Eugene Lim, founding principal of Taxise Asia and an international tax and trade expert, is quoted in the report.
That implies that you are not exempt, even if you live in the Philippines.
Price hikes?
Behind the scenes, data centers are the beating heart of streaming services. Cloud infrastructure is used by services such as Netflix and Spotify to host movies and songs, as well as give algorithmic suggestions. The US leads with over 5,300 data centers, powered primarily by computer giants like Amazon Web Services, Google Cloud, Microsoft Azure and Oracle based in Strait Times.
But here’s the kicker: many of the hardware components that power these data centers — memory chips, controllers and sockets — are manufactured in China. According to Irene Tham, an assistant news editor who covers tech coverage for The Straits Times, “Trump’s proposed tariffs would hit these imports hard, raising the cost of operating and upgrading US-based data centers.”
Spotify, a Swedish corporation that relies heavily on Google Cloud, isn’t exempt either. Spotify has been using Google Cloud since 2016 and is currently researching advanced AI techniques from Google to tailor playlists and filter material more efficiently.
More taxes, more pesos
Filipino consumers are already prepared for higher streaming charges, and not just due to Trump’s tariffs. A new 12 percent value-added tax (VAT) on nonresident digital service providers — including Netflix — will take effect in June.
Netflix Philippines recently announced new pricing ahead of the VAT implementation on 1 June:
•Mobile: P169 (from P149)
•Basic: P279 (from P249)
•Standard: P449 (from P399)
•Premium: P619 (from P549)
Adding an additional member spot to your account? That is also up — from P149 to P169.
Other services, including Spotify, Apple Music, Amazon Prime Video and gaming platforms such as Steam and Nintendo, will follow suit.
BIR Commissioner Romeo Lumagui stated during a briefing, “In other countries, they are paying their taxes. We are already late in the game. But of course, it is not guaranteed that there will be no price increase.”
The combination of foreign tariffs, cloud expenses and local taxes creates a clear picture: your digital lifestyle will get more expensive.
While Trump’s tariffs may appear to be a distant, their impact on the technological backbone of digital services and the worldwide pricing strategy of firms such as Netflix and Spotify is apparent.
Streaming isn’t only about chilling anymore. As both domestic and foreign factors continue to reshape the environment, Filipino users may need to brace for further increases or reconsider how many streaming services they truly need.