Today, in a letter to investors (via The Verge), Netflix confirmed it will finally launch a less expensive streaming plan. The plan will be a Netflix mobile-only service that will start in India, with the possibility to expand to other countries later.
Netflix has tested a mobile-first plan several times in several different countries. 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 (such as a Roku), and not on your PC or laptop.
The company described the Netflix mobile-only plan as “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 (average revenue per user) is low (below $5).”
We don’t know what the pricing will be for the Netflix mobile-only plan, but the test runs it performed earlier had it at 250 rupees (~$3.63) per month. The current price for the Basic plan in India is 500 rupees (~$7.27), which is the lowest price available.
By contrast, the Basic plan price in the U.S. is $8.99 per month.
Although the company didn’t present a direct correlation, the announcement of this new strategy likely has something to do with the dismal earnings and subscriber growth report the company pushed out today. That report confirms the company lost $544 million over the past three months and only added 2.7 million new subscribers when it projected it would gain twice as many.
By introducing a new, incredibly cheap option for people to start watching Netflix, the company can help boost those numbers.
It’s not clear when or even if Netflix would bring a mobile-only plan to other countries, including the United States. We’ll need to watch and see how this new plan works in the India market first.
What do you think? Will you subscribe to this Netflix mobile-only plan in India? Would you if it came to your country? Let us know in the comments.