In the category of “Something You Have to Say to Investors but Probably Don’t Want the Whole World Knowing,” we have a new entry by Netflix CFO David Wells. It’s titled, “Netflix Will Be Cheaper in Countries That Pirate More.”
BGR is reporting that Wells did, indeed, state in a Netflix earnings call this past week that the service’s subscription price will drop in high-piracy locales. And it isn’t that the strategy’s not sound — there are people in other countries that just don’t make as much money as we do here. You might find $8 or $9 in someone’s couch cushions. But a Netflix subscription is a luxury to those who are much less fortunate, which leads to a lot of piracy.
The problem is, as BGR agrees, that those who feel Netflix is overpriced may simply pirate — “voting with their wallets,” so to speak. And Netflix’s own CFO is admitting that a lot of people are already doing it.
Will this becoming an issue here in the United States? I don’t think so. Netflix is affordable enough for most, and those who would pirate likely already do. Not because they can’t afford the goods or services, but because they’d much rather pay nothing for them. These aren’t the folks Netflix is targeting.
But it does make you wonder about territories where the price of a Netflix subscription may be a bit too much for some — territories that Netflix hasn’t specifically deemed high-piracy. Would those consumers turn toward piracy if it meant nudging Netflix toward a cheaper monthly rate?
It’s something to keep an eye on, for sure.