Expert: "More Payment Options Should Be Offered in Asia"
[Asia Economy Reporter Kim Hyunjung] Global streaming service Netflix, which is facing challenges due to sluggish new subscriptions, is reportedly seeking a breakthrough in the Asian market, Bloomberg reported on the 27th (local time).
The report cited Tony Metskovski, Vice President of Business Development for Netflix Asia-Pacific, saying, "Despite plans to curb overall spending, Netflix will continue to increase investments in the Asia-Pacific region, including funding for local film and series production."
Vice President Metskovski explained, "We plan to continue offering low-cost mobile-only memberships across Asia, but to attract more customers in regions where credit card usage is low, we are exploring more partnership strategies with wireless carriers and digital payment companies." He added, "Asia is an excellent proxy for other global markets," emphasizing, "There are many similarities between emerging Asia and emerging markets such as Africa and Latin America, so strategies developed here (in Asia) can be applied and utilized in other regions."
Netflix, the world's largest streaming platform, has grown rapidly over the past few years with a surge in subscribers, but announced in April that it experienced a decline in customer numbers for the first time in 10 years. Additionally, with the emergence of similar platforms intensifying competition, further setbacks are anticipated, causing its stock price to plunge.
Asia-Pacific subscribers account for about 15% of Netflix's total 221.6 million subscribers, and Netflix expects significant additional customer growth in this region. New subscriptions in this region totaled 1.1 million in the first quarter, a 20% decrease compared to the same period last year. In particular, the service itself has faced challenges in some markets due to cultural and political backlash. A notable example is the controversy over a kissing scene between a Hindu woman and a Muslim man in the series A Suitable Boy.
Currently, the Asian market is relatively less profitable. Average revenue per member in the Asia-Pacific region was $9.21 per month, down 5% year-over-year, while during the same period, the U.S. and Canada saw a 5% increase to $14.91.
Vivek Kuto, Managing Director of Media Partners Asia, stated, "Without a larger customer base, price increases are not possible," and explained, "To offset price discounts, focus must be placed on expanding the user base in high-revenue countries such as Japan and Korea, as well as emerging markets like Thailand and Indonesia." He also predicted that to generate meaningful revenue in India, an additional 20 to 30 million subscribers would be needed. He further suggested that Netflix should offer more diverse payment options than competitors in Asia.
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