Since going public, Spotify’s senior execs (and former Netflix CFO Barry McCarthy in particular) have regularly been asked whether the company will take any inspiration from Netflix in its pricing strategy. That’s usually a question about whether and when Spotify will raise its prices, so it’s interesting this week to see Netflix talking about its plans to test *lower* pricing than its current $7.99 basic tier. It’s for specific markets though. The news comes in a Bloomberg piece based on an interview with Netflix CEO Reed Hastings, albeit with lots of paraphrasing rather than direct quotes.
While Hastings didn’t say where the tests of lower prices would take place, the article zeroes in on Asia, and India in particular – where Netflix currently costs 500 rupees a month (around $6.85) compared to local rival Hotstar Premium which costs 199 rupees. The details are interesting: “Netflix offers subscriptions at three price levels, and doesn’t plan to lower that of its cheapest tier,” claimed Bloomberg. “Instead, executives are formulating an alternate version of the service, or a fourth tier, that will have different features and cost less.”