Net­flix mulls cheaper prices to chase In­dian view­ers

Calgary Herald - - FINANCIAL POST - DREW ARM­STRONG

Net­flix be­lieves that In­dia has hun­dreds of mil­lions of po­ten­tial video cus­tomers, and the com­pany will ex­plore a lower-priced plan to reel them in.

“We’ll ex­per­i­ment with other pric­ing mod­els not only for In­dia, but around the world that al­low us to sort of broaden ac­cess by pro­vid­ing a pric­ing tier that sits be­low our cur­rent low­est tier,” Net­flix chief prod­uct of­fi­cer Gre­gory Peters said on a con­fer­ence call with an­a­lysts late Tues­day after the com­pany re­ported third-quar­ter earn­ings.

The com­pany may also add shows for In­dia in lan­guages other than English and Hindi, chief ex­ec­u­tive of­fi­cer Reed Hast­ings said on the call.

He cited hun­dreds of mil­lions of mo­bile phone sub­scribers in the coun­try as po­ten­tial cus­tomers.

“We’ll take it one mil­lion at a time and fig­ure out how to ex­pand the mar­ket as we grow,” Hast­ings said.

On the call, Hast­ings de­clined to pro­vide ex­act de­tails on the com­pany’s In­dia growth.

The rise of on­line en­ter­tain­ment in In­dia has par­al­leled the growth of high-speed in­ter­net in the coun­try. More than 150 mil­lion peo­ple in the coun­try have high-speed in­ter­net ac­cess, of­ten through their phones.

Rev­enue from “over-the-top” video ser­vices like YouTube, Net­flix and oth­ers reached 20.2 bil­lion ru­pees in 2017, ac­cord­ing to a Price­wa­ter­house­Coop­ers re­port.

After a stum­ble with its pre­vi­ous re­sults, Net­flix an­nounced on Tues­day it added far more sub­scribers than an­a­lysts ex­pected in the third quar­ter. The world’s largest paid on­line TV net­work also is­sued an up­beat out­look for the cur­rent three months, say­ing it plans to add 28.9 mil­lion cus­tomers in to­tal this year, a record for the 21-year-old com­pany.

The shares jumped as much as 9.7 per cent Wed­nes­day in New York trad­ing.

The re­sults should pro­long Net­flix’s reign as one of the best-per­form­ing stocks on Wall Street, giv­ing the com­pany lee­way to spend bil­lions of dol­lars more on orig­i­nal pro­gram­ming.

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