Netflix lowers subscription cost to maintain membership growth
Technology
Price reduced in Middle Eastern, sub-Saharan African, Latin American and Asian countries
(Reuters) - Netflix has lowered the cost of some of its subscription plans as the streaming juggernaut attempts to maintain membership growth in the face of fierce competition and constrained consumer spending.
The stock decreased by about five percent falling behind the general market and heading for its worst day in more than two months.
The streaming sector has experienced fierce competition over the past year as a pandemic-driven boom fades and customers reduce spending out of concern for a potential recession, prompting businesses to reconsider their strategy.
The price reductions reportedly took occurred in various Middle Eastern, sub-Saharan African, Latin American, and Asian nations, according to the Wall Street Journal, which broke the news first.
In certain situations, the cost of a membership was slashed in half, according to the Journal, and the discounts only apply to select Netflix levels in those regions.
As the marketplaces in the United States and Canada get saturated, Netflix, which has operations in over 190 countries, has been attempting to increase its market share in more recent foreign areas. It announced plans to strictly prohibit the sharing of passwords for accounts on its streaming platform earlier this month.
After losing customers in the first half of 2022 as competitors like Paramount+ and Disney+ vacuumed in users, the firm added roughly 7.6 million new subscribers in the fourth quarter of that year.
Yet during the last three months of 2022, average income per membership fell across all areas.
"We are constantly looking for ways to enhance the membership experience. We can vouch for the fact that in some nations we are altering the prices of our programs "a business spokeswoman stated.
The representative withheld more information on the pricing reductions.
