In a recent letter to investors, Netflix announced that it will finally launch a mobile-only streaming plan for much less than its usual streaming plans. The mobile-only plan will be offered in the Indian market. Netflix may be one of the most popular video streaming services in the world right now, but the company has struggled to gain a strong foothold in India.
Through this move, the streaming giant aims to tap into a price-sensitive market where data consumption on smartphones is surging. The company announced in March that it was testing a Rs. 250 monthly subscription for mobile devices in India. The decision is also driven by the fact that Indian data plans are one of the cheapest in the world.
In the letter to its shareholders, Netflix said, “We believe this plan, which will launch in Q3, will be an effective way to introduce a larger number of people in India to Netflix and to further expand our business in a market where Pay TV ARPU is low (below $5). We will continue to learn more after launch of this plan.”
The plan allows you to watch as much Netflix content as you like, but only on one smartphone or tablet at a time, i.e. not on your television, not through a streaming device, and not on your PC or laptop.
Price of the plan
The new plan will supposedly cost subscribers Rs. 250 for unlimited content on their smartphones and tablets. However, there is a catch. Users will only be able to stream the content in Standard Definition (SD 480p) and only on a single screen at a time instead of multiple.
Currently, Netflix offers three monthly plans in India, priced between Rs. 500 and Rs. 800. In contrast, Hotstar offers content from HBO and streams live sports for a monthly subscription of Rs. 299. Amazon Prime offers its Prime Video bundled together with a prime membership for an annual fee of Rs. 999 or a monthly charge of Rs. 129.
Although the company did not specify a reason for offering the cheaper plan, the new strategy likely has something to do with the fact that Netflix posted a loss of $544 million in the previous quarter and only added about 2.7 million more subscribers in that time, which is only 50% subscribers of its projected 5 million.
India figures prominently in Netflix Chief Executive Officer Reed Hastings’ global expansion plans. The company is investing heavily in creating blockbuster shows such as crime thriller Sacred Games and Delhi Crime with A-list Bollywood actors.
“We’ve been seeing nice steady increases in engagement with our Indian viewers that we think we can keep building on. Growth in that country is a marathon, so we’re in it for the long haul,” Netflix Chief Content Officer Ted Sarandos said.
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