Where are Netflix prices dropping? In over 100 territories – but not in the US
Sure, cracking down on password sharing sucks – but Netflix can make up for it by justifying prices in poorer countries.
Maybe Netflix didn’t get the memo about raising streaming subscription prices. And the other is about the number of subscribers, which is no longer the best measure of the service’s success.
IndieWire has confirmed that Netflix has reduced monthly subscription fees in more than 30 countries (or more than 100 territories) worldwide. The “Basic” tier of the service, the ad-free tier, is experiencing the largest percentage drop in several territories, including Central and South America (CSA), Sub-Saharan Africa (SSA), and the Middle East and North Africa (MENA). ), by Central and Eastern Europe (CEE) and Asia-Pacific (APAC) regions Ampere analysis. Those areas will receive a 20-60 percent discount from the plan, the market researcher wrote; here in the US we pay $9.99 a month for it. The price reduction is automatic for both new and existing subscribers.
“We are always looking to improve the experience for our members,” a Netflix spokesperson told IndieWire on Thursday. “We can confirm that we are updating the prices of our plans in certain countries.”
But why is Netflix suddenly so generous? The service has basically maximized its reach here in the US and Canada, with the greatest potential for growth remaining in many poorer regions of the world. These potential users are much more likely to use ad-supported streaming services, but Netflix’s “Basic with Ads” plan is currently only available in 12 countries: Australia, Brazil, Canada, France, Germany, Italy, Japan, Korea, Mexico and Spain. , the United Kingdom and the United States. These countries don’t get this discount – they usually don’t need it.
Without (yet) access to the ad-supported Netflix model, subscribers in less affluent regions can rest easy. Much like Netflix has raised prices in places where subscribers can absorb the price increase, this downward pricing shift reflects the economic reality of poorer areas, a person with knowledge of the decision told IndieWire.
More “Basic with Ads” regions are expected to appear, and one day Netflix may add a FAST (free ad-supported streaming television) service — an option that relies entirely on ads, not a monthly subscription. At the end of 2022, Netflix reported 230.75 million global paid subscribers; which included the new ad-supported option.
Courtesy of Netflix
“Since Netflix reportedly plans to charge consumers extra to allow additional ‘out-of-home’ users to access their accounts, these price cuts will potentially eliminate additional costs for current account-sharing subscribers,” Ampere wrote. “While this move will have a negative ARPU impact on Netflix in these emerging markets, it could lead to subscriber growth among unserved consumers.”
As part of its fourth-quarter earnings call, Netflix said it will introduce “paid sharing” later this quarter (details, including pricing, which will vary by region, are yet to be revealed). Based on trials in Latin America, the company expects some subscribers to initially cancel the service as a knee-jerk reaction, but an overall increase in revenue will soon follow. Netflix maintains that more than 100 million households currently share the account and are therefore not adequately monetized in Netflix’s opinion.
“Some of it is economically driven, and so we’re looking to make sure we’re responsive to that and find the right price points, whether it’s an individual account or a non-member benefit,” Netflix said. new co-CEO Greg Peters said at the time.
A Netflix spokesperson we spoke to for this story declined to comment on the many details Ampere provided, including the following.
Not everything is “standard” (here’s the popular $15.49 package) in the same markets, such as Vietnam and Malaysia, the lower strata get a discount, but many do, the company wrote. In the Philippines, the discount will be 13 percent; elsewhere it reaches 50 percent. In the Philippines, Vietnam, and Malaysia, there will be no discount to the “Premium” tier (here $19.99/month); all other discount markets receive a price reduction of 17-43 percent. In many cases, such as Indonesia, Egypt, Ecuador, Morocco and Croatia, the new “Standard” price is just the old “Basic” price – essentially a free resolution upgrade (from 720p to 1080p) and an account discount. to have two parallel data streams.
Netflix cuts the price by 25 to 33 percent in certain regions for its mobile-only tier, a popular option in low-broadband markets. More populated regions such as India, Indonesia, Thailand, Malaysia, Philippines, Vietnam, Pakistan and Nigeria do not receive the mobile discount.
Courtesy of Netflix
Ten markets – Indonesia, Thailand, Malaysia, the Philippines, Egypt, Ecuador, Vietnam, Morocco, Croatia and Kenya – will apply discounts to local prices based on Ampere’s analysis. (Localized pricing helps subscribers avoid fluctuations due to currency fluctuations.) Netflix has more than 10 million total subscribers in these markets.
Below is the full list of areas where Netflix has cut prices, according to Ampere, in alphabetical order. More details can be found here.
Bosnia and Herzegovina
British Indian Ocean Territory
Central African Republic
Congo – Brazzaville
Congo – Kinshasa
Papua New Guinea
São Tomé and Príncipe
St. Vincent and the Grenadines
Wallis and Futuna
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