Last year in its earnings call with investors, Netflix’s top man Reed Hastings had reiterated that they are very happy with the OTT platform’s India pricing and that they had no plans of lowering their rates. However, a year later, the streaming giant has now announced that it will roll out a cheaper subscription plan in India. No doubt, Netflix is stepping on the gas to speed up its declining growth with this move.
The decision comes on the heels of shares of Netflix going down 10% in extended trading on Wednesday after it released its earnings report for the second quarter. As per the results, for the first time in 8 years, Netflix lost over 100,000 subscribers in the US. It also showed that the company missed on the numbers that matter – international subscribers. The OTT giant’s international net additions were 2.8 million, which is quite significant, except that the expected additions were close to 4.8 million.
According to a report by cnbc.com, “Netflix can sustain its lofty valuation only if global subscriber growth can support increasing content spending and debt. And growth is entirely dependent on Netflix’s prospects internationally, in countries such as India and Malaysia.”
Netflix has reportedly attributed its pricing in certain countries as one of the reasons to why it has missed its mark on adding international subscribers.
