Netflix had lowered its subscription prices across all its plans in December 2021, bringing its lowest plan at INR 149 per month for Indian market
Netflix has seen a 30% growth in customer engagement and 24% revenue growth year-on-year in India in 2022 following the price reduction
Learning from this success, we reduced prices in an additional 116 countries in Q1: Netflix
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Streaming giant Netflix has slashed subscription rates in 116 countries following the success of the same strategy in India. Netflix had lowered its subscription prices across all its plans in December 2021, bringing its lowest plan at INR 149 per month for India.
Following the price reduction strategy in India, Netflix has seen a 30% growth in customer engagement and 24% revenue growth year-on-year in the country in 2022.
“These reductions — combined with an improved slate — helped grow engagement in India by nearly 30 per cent year-on-year while F/X (forex) neutral revenue growth in 2022 accelerated to 24 per cent (versus 19 per cent in 2021). Learning from this success, we reduced prices in an additional 116 countries in Q1,” the company said in its earnings report.
It is prudent to note here that the markets where Netflix has slashed the price contributed less than 5% to its total revenue during 2022.
“We believe that increasing adoption in these markets will help to maximize our revenue in longer term,” the streaming giant added.
Overall, Netflix added 1.75 Mn net new subscribers in Q1, compared with adding 7.66 Mn for the final quarter of 2022, with the Asia-Pacific region leading the growth. The APAC region added 1.46 Mn subscribers in the quarter accounting for over 80% of the subscriber growth.
For India, the company’s co-CEO, Ted Sarandos recently said Netflix is looking to tap the India opportunity, while it needs to look at a better pricing.
“When we get the pricing a little better and more suited to the market, you can see that we can grow revenue, and therefore, we grow engagement. We have to get the content that people just really flip out for,” Netflix co-CEO, Ted Sarandos said during Netflix’s first quarter earnings call.
Netflix competitors in the country include Zee5, MX Player. While in the regional OTT segment, its rivals are Hoichoi and Aha. Globally, it competes with Amazon Prime Video and Disney+Hotstar. With the entry of Jio Cinema, Netflix has got another cash-heavy big competitor in the Indian market as Reliance is planning to release as many as 100 movies and shows on JioCinema over the next 18-24 months.
According to a report by RBSA Advisors, India’s video OTT market is expected to reach a size of $12.5 Bn by 2030 from about $1.5 Bn in 2021 owing to contributing factors such as better networks, digital connectivity and smartphone penetration.
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