Why Is Netflix Dropping Its Price in Over 100 Global Territories; Could Cuts Help Attract Password-Sharers?
Netflix is zigging while everyone else in the streaming industry is zagging. Effective immediately, the service is cutting subscription prices in over 100 countries around the world, though not in any North American or Western European markets. According to the London-based analytics and market research firm Ampere Analysis, this will affect more than 10 million global Netflix users.
The amount that Netflix is decreasing its prices varies by country, but most territories are seeing a discount of between 20% and 45%. The cost of an Indonesian subscription to Netflix’s Standard plan, for example, is now 120,000 IDR, the equivalent of around $10 USD.
That’s around 33% cheaper than a Netflix Standard subscription costs in the United States, although the Indonesian content library is far smaller than the catalog on the American version of the streamer. There’s no denying, however, that the move to reduce global subscription costs is contrary to what most streaming services are doing nowadays.
All of Disney's streaming services raised prices in 2022 as did Apple TV+; HBO Max followed suit in 2023. Paramount executives have confirmed price increases are coming to Paramount+, while Peacock recently dropped its free tier as an option for new subscribers.
The streaming industry is dead-set on boosting its profitability and is leaning on customers to pay more to make it happen. So why is Netflix rolling out these price decreases now?
For starters, Netflix is already profitable, and it’s the only major streaming service to report being so. But the company is planning to introduce anti-password sharing measures to all its users in the coming weeks and months, one of which will be to charge account holders an extra fee for users accessing Netflix outside the owner’s home.
Dropping subscription prices could be the first step in rolling out those password-sharing rules. A lower subscription cost could convince those sharing a password that it’s more worthwhile to sign up for their own accounts, while simultaneously mollifying account owners that were angered by the news that measures to combat password sharing are coming.
Lower prices will hurt the average revenue per customer that Netflix enjoys in the short term, but it could help the service become harder to churn away from. The company’s future quarterly earnings reports will bear more close scrutiny to determine whether the price decreases have a major effect on its global user numbers.
Netflix is a subscription video streaming service that includes on-demand access to 3,000+ movies, 2,000+ TV Shows, and Netflix Originals like Stranger Things, Squid Game, The Crown, Tiger King, and Bridgerton. They are constantly adding new shows and movies. Some of their Academy Award-winning exclusives include Roma, Marriage Story, Mank, and Ma Rainey’s Black Bottom.
Netflix offers four plans — on 2 device in HD with their “Standard with Ads” ($6.99) plan, on 1 device in SD with their “Basic” ($9.99) plan, on 2 devices in HD with their “Standard” ($15.49) plan, and 4 devices in up to 4K on their “Premium” ($19.99) plan.
Netflix spends more money on content than any other streaming service meaning that you get more value for the monthly fee.