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Netflix’s Rs 199 plan is a nod to its sky high confidence in the Indian smartphone user

Netflix’s Rs 199 plan is a nod to its sky-high confidence in the Indian smartphone user

Netflix’s Rs 199 plan is a nod to its sky-high confidence in the Indian smartphone user
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By Jude Sannith  Jul 24, 2019 4:32:10 PM IST (Published)

On Wednesday, online streaming content provider Netflix launched its cheapest plan in India. At Rs 199 per month, Netflix users that subscribe to the portal’s ‘Mobile’ plan can view content, in standard definition and ad-free, on a smartphone or tablet.

On Wednesday, online streaming content provider Netflix launched its cheapest plan in India. At Rs 199 per month, Netflix users that subscribe to the portal’s ‘Mobile’ plan can view content, in standard definition and ad-free, on a smartphone or tablet.

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What this means is that the vast majority of Netflix’s Indian audiences who consumes content on a mobile device — as opposed to a laptop or a PC — will save at least Rs 300 every month on subscription charges. The cheapest plan up until the announcement was its Basic plan, which priced at Rs 499, allowed users to subscribe to Netflix’s content on a single device of their choice. Standard and Premium Plans have been priced at Rs 649 and Rs 799, respectively.
“Our members in India watch more on their mobiles than members anywhere else in the world, and they love to download our shows and films,” said Ajay Arora, Director, Product Innovation, Netflix, “We believe this new plan will make Netflix even more accessible and better suit people who like to watch (content) on their smartphones and tablets — both on the go and at home.”
Curiously enough, the launch of Netflix’s Mobile plan comes after reports emerged that Netflix was mulling over the possibility of pricing the plan at Rs 250, while testing was underway. The Rs 51 slash means Netflix is making it amply clear that it wants to compete hard in the Indian market, positioning itself strategically closer to Amazon Prime's Rs 129-per-month plan for Indian users. Hotstar Premium's monthly subscription, however, has now turned significantly more expensive, at Rs 299.
“The launch of Netflix’s Mobile plan is a strong move to tap the market and gain price-sensitive customers,” said Abneesh Roy, Senior Vice President (Research), Edelweiss Securities, “The launch could mean existing users moving away from plans which are priced between Rs 499 and 799, given the sharp dip in pricing, while overall subscriber count could definitely see an uptick.”
There are stats to back these observations. According to a FICCI-EY 2019 report, Indians are learnt to spend 30 percent of their phone time (and 70 percent of their mobile data) on entertainment. Cheaper entertainment from Over The Top (OTT) content providers allows these companies to leverage on this encouraging statistic.
Interestingly enough, while Netflix launched its affordable Mobile plan in India, it has also quietly tied up with AT&T in the United States, to launch its content on the latter’s Android-TV-powered streaming player. The announcement comes even as AT&T has been mulling over moving its customers to a cheaper streaming version of its services, to save on costs.
In keeping with these goals, the Netflix partnership couldn’t have come at a more opportune time. AT&T stands to save money by longer needing to pay for satellites in space, while still managing to provide American audiences with the latest from the Netflix stable. However, there has been no confirmation on whether Netflix intends to tie up with telecom players in India, to launch similar set-top boxes. Analysts say the company may have missed a trick, here.
“In India, several families continue to consume content on a television set despite the growing popularity of mobile consumption,” said Roy, “Any partnership with a telecom player will help, provided the costs incurred are viable.”
For the moment, though, Netflix is happy banking on growing its smartphone savvy audience by giving them the same OTT content but for much cheaper. The fact that Zee’s cheaper plans come with limited OTT content gives Netflix with a clear edge. “But continuing to release shows will be crucial for Netflix, especially when it comes to uploading local content,” said Roy.
Netflix, on its part, is aware of this. The portal has begun investing heavily in Indian films and series across genres, including hits like Sacred Games and Chopsticks. Thirteen new films and nine new original series made specifically for Indian audiences, are in the pipeline.
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