Netflix has cut subscription rates in 116 countries after its success in India.
New Delhi:
Netflix has slashed subscription rates in 116 countries following the success of its business model in India, the company said on Wednesday.
Netflix has seen a 30 per cent year-on-year increase in subscriber additions and 24 per cent growth in revenue in India after launching a low-cost subscription plan in the country in 2021.
For the first time, the company had reduced subscription prices by 20-60 per cent to suit the Indian market and deepen its penetration.
“These reductions – combined with an improved slate – helped drive year-on-year growth in India by nearly 30 per cent, while driving F/X (foreign exchange) neutral revenue growth to 24 per cent in 2022 (compared to 19 per cent in 2021) Learning from this success, we reduced prices in an additional 116 countries in the first quarter,” Netflix said in its earnings report for the March 2023 quarter.
The countries where Netflix has reduced the price have contributed less than 5 percent of its total revenue during the financial year 2022.
“We believe that increasing adoption in these markets will help us maximize our revenue over the long term,” the company said.
Netflix’s global net income for the quarter ending March 2023 is expected to drop by nearly 18 per cent to USD 1,305 million, from USD 1,597 million in the same period a year ago.
However, Netflix’s revenue grew by 3.7 percent to USD 8,162 million in the March 2022 quarter from USD 7,868 million in the March 2022 quarter.
The company’s paid memberships globally grew 4.9 percent year-on-year to 232.5 million.
Netflix expects its net income to decline by about 1.6 per cent to US$1,283 million in the April-June 2023 quarter, while revenue will rise by 3.4 per cent to US$8,242 million.
The company, which earlier resisted ads on its platform, has now launched ad-based plans with lower subscription price points than its initial plans.
“The level of engagement with our ads has exceeded our initial expectations and, as expected, we have seen very little switching from our standard and premium plans,” Netflix said.
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