Paying for Netflix could get more expensive in 2024 as the streaming giant subtly hinted at a possibility of increasing prices in its fourth quarter (Q4) earnings report and letter to shareholders. Apart from the possible price hike, Netflix also announced that it will discontinue its cheapest ad-free plan in countries, where it offers an ad-supported tier, starting with Canada and the UK in Q2 2024.
Notably, Netflix has already restricted new and returning customers from signing up for the ad-free basic plans. But so far it allows the existing customers to keep their subscriptions till the end of their tenure. The company could also discontinue the basic plan for the existing subscribers.
Let’s take a look at the latest development regarding the Netflix price hike and what it means for Netflix users in India.
Netflix Might Hike Prices and Discontinue Its Cheapest Ad-Free Plan
In its letter to shareholders, Netflix stated, “We seek to provide a range of prices and plans to meet a wide range of needs, including highly competitive starting prices. As we invest in and improve Netflix, we’ll occasionally ask our
members to pay a little extra to reflect those improvements, which in turn helps drive the positive flywheel of additional investment to further improve and grow our service.”
As the first step towards improving the content library, Netflix announced that it has signed a deal with WWE. According to the letter, WWE RAW will be live on Netflix exclusively in the US, Canada, UK, and Latin America, with more countries added over time. Additionally, Netflix will become home to WWE-exclusive events outside of the US, like SmackDown, NXT, Wrestlemania, SummerSlam, and Royal Rumble.
The streaming giant has also assured the addition of award-winning documentaries and series starting in 2025. Notably, Netflix has paid over $5 billion to WWE for 10 years of exclusive rights.
With more exclusive content on the platform, Netflix will have the leverage to convince its users to pay more. The company has stated in the shareholders’ letter that it plans to hike the content amortization by a high single-digit YoY percentage.
Netflix also announced that the platform gained 13.1 million subscribers during Q4 of 2023, its highest ever for a single quarter. With this gain, Netflix now has 260 million subscribers worldwide. The ad-supported tier subscribers also grew to 23 million from 15 million in November 2023. This is the reason why Netflix is pushing more subscribers to the ad-supported tier or beyond and planning to discontinue the ad-free basic plan.
Will Netflix Hike Price in India?
Netflix has hinted at a price hike in countries where it offers an ad-supported tier, which means it might not impact prices in India. The streaming giant currently offers four plans in the country, including Rs 149 Mobile, Rs 199 Basic, Rs 499 Standard, and Rs 649 Premium plans. All of these plans are ad-free and offer varying resolutions up to 4K and a number of simultaneous streaming devices, depending on the plan.
Netflix has been aggressive with its pricing in India to counter the competition from Disney+ Hotstar and Prime Video. The company has been partnering with leading telcos in the country to bundle its plans with prepaid/postpaid plans and also reduce the cost to gain a stronger foothold in the country.
Netflix managed to gain subscribers in India thanks to the introduction of the Rs 149 mobile-only plan and Rs 199 Basic plan, which offer a value-for-money proposition to Indian streamers.
However, it still lags behind Disney+ Hotstar with 50 million subscribers and Prime Video with 20 million users. Netflix was in the third spot with 6.5 million users. This is the reason why the company is yet to introduce an ad-supported tier or hike prices in India.
