People Are Lazy to Subscribe, This
Is Why Netflix Wants to Raise Prices
Jakarta, CNBC Indonesia –World citizens are increasingly reluctant to subscribe to Netflix. The growth in the number of new users of the streaming service is estimated to have fallen to its lowest point in 1.5 years.
The sluggish growth in the number of new subscription users illustrates that the impact of the ban on various Netflix passwords has begun to fade. LSEG analysis quoted by Reuters, estimates that Netflix only got 4 million new subscription users in the July-September period.
Nielsen data shows that the most popular content on Netflix in the same period was The Accident and The Perfect Couple.
Amidst the sluggish subscriber growth rate, Netflix is trying to prioritize advertising revenue figures. The American company even stated that it would no longer share user data starting next year.
“Their focus now is to continue to increase the number of subscribers while increasing scale, the flexibility to raise prices, and gaining advertising revenue,” said Jeff Wlodarczak of Pivotal Research, as quoted by Reuters.
However, advertising revenue is not expected to support Netflix’s financial performance until at least 2026.
“They posted advertising revenue in the US, less than US$ billion, which doesn’t look good,” said Ross Benes of eMarketer.
Some analysts have suggested that Netflix raise prices so that more users switch to subscription packages with ads. The reason is that subscription categories with ads generate higher revenue per subscriber.
Netflix in July began removing its basic subscription package without ads for US$ 9.99 (Rp 155 thousand) per month for new users in the UK and US. For existing customers, the package will be removed gradually.
Netflix’s subscription package with ads in the US is priced at US$ 6.99 (Rp 108 thousand) per month, while the package without ads is priced at US$ 15.49 (Rp 240 thousand) per month.
In Indonesia, Netflix’s cheapest subscription package is Rp 54 thousand per month and the most expensive is Rp 186 thousand per month. Netflix has not yet offered a subscription package with ads in Indonesia.
Netflix currently operates in more than 190 countries. The company is projected to report advertising revenue of $242.7 million in Q3/2024. Netflix’s total revenue is expected to grow 14.3 percent to $9.76 billion.
SOURCE : CNBC INDONESIA
