Netflix Cuts Subscription Prices in Over 30 Countries
Netflix Inc has reduced the cost of its service in more than three dozen countries in recent weeks, as it tries to appeal to customers around the world who have an ever-growing list of streaming options.
The streaming company’s recent price cuts span Middle Eastern countries including Yemen, Jordan, Libya and Iran; sub-Saharan African markets including Kenya; and European countries such as Croatia, Slovenia and Bulgaria.
In Latin America, nations including Nicaragua, Ecuador, and Venezuela have seen reductions in subscription costs, as have parts of Asia including Malaysia, Indonesia, Thailand and the Philippines.
The cuts apply to certain tiers of Netflix in those markets—in some cases halving the cost of a subscription.
The Major streaming services have spent recent quarters touting the value that they deliver to consumers relative to the monthly fee they charge, and several have raised prices in the U.S. in recent months.
“It definitely goes against the recent trends not just for Netflix, but for the broader streaming industry,” John Hodulik, a media and entertainment analyst at UBS Group AG, said of Netflix’s recent price cuts. “Some of these cuts on a percentage basis are substantial,” he said.
As recently as last month, Netflix executives talked about raising—not lowering—prices. In a January earnings call, co-Chief Executive Greg Peters said the company is looking for places where they can afford to raise prices, which feeds continued content investments.
“We think of ourselves as a non-substitutable good,” Mr. Peters said. Netflix also has an opportunity to add new subscribers in markets where it doesn’t currently have a large share, he said.
Netflix’s price changes are a sign that big streamers are still grappling with what pricing will deliver the best combination of subscriber growth and revenue abroad. Consumers can choose between local cable providers, regional streaming services and big global platforms.
Big players including Walt Disney Co.’s Disney+, Warner Bros. Discovery Inc.’s HBO Max and Paramount Global’s Paramount+ are all expanding overseas.
“We know members have never had more choices when it comes to entertainment,” and the company is committed to delivering an experience that exceeds their expectations, a Netflix spokeswoman said. She said the company was updating the pricing of plans in some countries.
Netflix operates in more than 190 countries and territories, and has spent much of the last year adapting to growing competition and changing viewing habits as consumers returned to commutes, travel and other activities that the pandemic put on hold.
The company worked to cut costs and enact two major strategic shifts: Creating a lower-price ad-supported plan and requiring subscribers who want to share their accounts with someone outside of their household to pay more to do so.
The Los Gatos, Calif.-based company added subscribers in each of the four regions for which it reports results in the final quarter of 2022, but its global average revenue per user declined to $11.49 in the final quarter of 2022, from $11.74 a year earlier.
Netflix earlier this month rolled out the new sharing restrictions in countries such as Canada and Spain, and said it plans to roll those changes out more broadly in the coming months.
Executives have said they know that enforcing the sharing limits will be unpopular and may cause some people to cancel their accounts, though it hopes to win them back with hit content. Netflix has also been trying hard to rein in password sharing. At first, Netflix was unclear about the circumstances that surrounded its efforts to squash password sharing, which confused and frustrated users far and wide.
Alas, limitations on account sharing are still full steam ahead as Netflix rolled out new password sharing rules, along with the option to pay for an outside user’s access, to four global markets earlier this month. Netflix has lowered the price of its service in the past, particularly when it faced tough competition or wanted to add users faster.