Netflix Says Lower Prices Key To Winning Users In India 

Netflix Inc. says lower prices are important in India as it looks add original films and series to draw users.

The video streaming giant, working on ways to increase prices in the U.S., Brazil, Mexico and other parts of Europe, is testing mobile-only packages in India that will be cheaper than its current plans, Greg Peters, its chief product officer, said in an analyst call. “We're not positive that's the right model,” he said, but the firm should do something to find a price tier that's lower than the lowest to broaden accessibility. “It will be important to adding members in India.”

Netflix is currently the most-expensive video streaming service in India, with monthly subscription plans starting at Rs 500. That compares with Hotstar's premium plan that starts at Rs 299 and Amazon prime—a bundled in offering including fast shipping, music and video—that costs Rs 129 a month. Hotstar, which announced a new plan of Rs 365 annually, boasts of 300 million monthly active users in the country.

Streaming services are trying to lure users in the country where more than half the 1.3 population is less than 25 years old. The cheap data boom in the world's second-largest telecom market means that there are more than half a billion users with access to wireless internet, driving consumption online videos.

But Netflix, in an emailed response to BloombergQuint, said not everyone will be part of its mobile-only pilot and there is a likelihood that it might not roll out those plans beyond the tests.

Netflix disclosed in its letter to its shareholders that in the quarter ended March it added 9.6 million subscribers, of which 7.86 were in the international markets. It targets to add 5 million subscribers in the three months through June.

The company had 148.9 million paid subscribers globally as of March, and it reported a revenue of $4.5 billion for the quarter.

While Netflix doesn't give country-specific information, the company said its investment in India has started to bear the fruit after the success of originals such as Sacred Games and Love Per Square Foot. “We're seeing the investment in local language content in India pay back in the form of excitement and member growth and hours growth,” Ted Sarandos, chief content officer at Netflix said. “That's encouraging us to keep going.”

It now plans to add a dozen original films this year.