Netflix has been losing subscribers and the revenues have slowed down even with the pandemic increasing media consumption in the past few years. The video streaming giant is looking for different ways to make money and one of them is the tightening of its password sharing policy, so much that people will be asked to pay for sharing their passwords with their friends.
Netflix hasn’t talked about the exact timeline for this change but over here we are trying to make a case for the company to avoid bringing this policy in markets like India, where the platform already faces a hard time to convince consumers into spending on its services.
Not Wanting To Spend
Indian users have been spoilt for choices, even in the OTT space which means platforms like Netflix have battled hard to convince them to spend on its service. Netflix in India costs Rs 149 per month which is accessible on mobile and tablet only and allows people to use one screen at a time. Netflix doesn’t have plans as cheap as this in any other part of the world, which tells you the challenge it faces in making people spend.
The basic Netflix plan that you can use across mobile, laptop and TV costs Rs 199 per month. When you compare these with the annual prices of Disney+ Hotstar and Amazon Prime Video among others, you can see why Netflix has found it hard to get more subscribers in India over the years. Netflix had talked about the success of the Rs 149 plan which shows you how unwilling Indian users are about spending big on the platform.
Sharing Password A Ritual
Password sharing is a concern for Netflix but most of you would agree that it is similar to a ritual for people who don’t want to pay for the platform but still enjoy its content. Shared Netflix usage is common in India as people clearly don’t want to pay Rs 199, Rs 499 or Rs 649 per month to avail its services.
If Netflix does bring the supposed password sharing policy in India, it is severely going to dent the company’s viewers, the watch time recorded by the platform in the country as many people would stop watching the content instead of paying to use it. So Netflix might actually lose more by killing the password share feature.
Watching Shows Based On Recommendation
This might sound odd but watching shows on OTT apps in India is heavily based on the word-of-mouth factor. Netflix does heavily advertise its shows but that is limited to the popular ones. For everything else, you either go through the search mechanism or randomly bump into a hidden gem.
All these factors mean people would rather go with their friend or family’s suggestion (mostly peers) and then hope the recommendation engine on the platform earns its money. Password sharing going away not only takes away the viewers but also reduces the impact of different content that doesn’t get advertised by Netflix.
These reasons clearly suggest that password sharing has not helped Netflix to make money but not having it in India will result in further consumer churn which is not going to help its case whatsoever.
