Global streaming giant Netflix announced an increase in the prices of its plans for the US, UK and France, but has kept the price-sensitive and potentially large market of India out of the strategy as it continues its attempt to expand its user base here.
As its crackdown on password-sharing yielded 8.76 million net addition of paid subscribers globally in the July-September quarter of 2023, the streaming service announced a price hike in the US, UK and France, according to its results declared early on Thursday.
“Starting today, we’re adjusting prices in the US, UK and France,” said Netflix Co-CEO Ted Sarandos in his letter to the shareholders of the American streaming giant. While the Ads and Standard plans remain unchanged, Netflix is increasing the prices of its Basic and Premium plans in the countries mentioned.
Sarandos reasoned in his letter that their “starting price is extremely competitive with other streamers and at $6.99 per month in the US, for example, it’s much less than the average price of a single movie ticket.”
“We'll sort of find our way based on that philosophy and see when the right time to ask customers to pay a little bit more would be,” said its other Co-CEO Greg Peters in the post-results earnings call:
However, India has proven to be a different game altogether for the American streaming company which has referred to the market as a “big prize”. Just six months ago, Sarandos said during the earnings call that the 20-60 per cent price reduction announced in India in December 2021, along with an improved slate, led to 30 per cent improvement in user engagement year-on-year.
In the latest quarter, the net addition of paid subscribers from Netflix’s APAC market, of which India is a part, rose from 1.07 million last quarter to 1.88 million now. In fact, the latest figure is the highest of the past four quarters. But average revenue per membership has steadily declined from $8.34 a year ago to $7.62 at the end of September 2023.
Netflix has been trying to crack the India market with mobile-only and other plans priced much lower than regular subscriptions. Yet, it continues to be more expensive than those of rivals Amazon Prime Video and Disney+ Hotstar.