Following several months of testing, Netflix is getting ready to officially launch a mobile-only plan in India. Priced significantly below its regular subscription plans, the new plan is meant to help the company better compete with local players like Hotstar.
Netflix announced the step in its Q2 2019 earnings letter to investors Wednesday, writing: “We believe this plan, which will launch in Q3, will be 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 is low (below $5). We will continue to learn more after launch of this plan.”
The streaming service began testing a mobile-only plan priced INR 250 (about $3.60) per month in India in March. (On Wednesday, a spokesperson declined to comment on the pricing for the new plan once it launches in Q3.) The company’s regular plans begin at INR 500 ($7.20) in the country. Netflix has been testing similarly-priced mobile-only plans in other countries as well, including Malaysia.
Comparably high pricing has long been seen as a roadblock to success for Netflix in India, where competitors charge significantly less for their paid video services. For instance, Disney’s Hotstar service only charges consumers INR 365 for a full year of paid access.
What’s more, Amazon charges Indian customers INR 999 for a year of Amazon Prime, which includes access to Prime Video. In other words: For the same money they would spend on two months of Netflix, Indian consumers could instead subscribe to a whole year of Prime Video, and get access to free shipping to boot.
Wednesday’s announcement of the new mobile-only plan came as the company revealed significantly lower-than expected international subscriber growth for Q2 of 2019.