Netflix plans to adapt its pricing to better fit the African market.
This is according to Netflix chief content officer Ted Sarandos, who recently spoke at a roundtable discussion on the streaming giant’s “Made in Africa, seen by the World” strategy.
Sarandos and Head of African Originals at Netflix Dorothy Ghettuba spoke to journalists about the streaming service’s plans for original African productions.
Before changing pricing, however, Netflix wants to ensure that African markets are provided with significant value when it comes to the service’s local offering.
Most South Africans access the Internet via their mobile phones, especially where fixed-broadband access is limited.
This means that many might not be able to use streaming services like Netflix on computers or TVs, but primarily do so on smartphones.
MyBroadband asked Sarandos whether Netflix would consider a mobile-only offering to take this challenge on in the South African market.
He said that the company is aware of challenges around data in the region, and said the Latin American region was an example of how the company specifically worked its strategy around international originals to address these problems.
“We intentionally did that so we can cut our teeth on places that are difficult to operate in,” he explained. “We’re getting better and better at it.”
Netflix launched a mobile plan in India at 199 rupees (R42). A similar package could be very attractive to a South African audience.
Sarandos explained why the launch of Africa’s mobile-only plan could take time.
“In India recently we introduced a mobile-only programme. Prior to doing that, we spend a lot of time in India – producing a lot of original content, building the subscriber base, building a relationship with consumers and all those things so that we do it well.”
“So I would not be surprised to see some more things for Africa as we go, but we’re launching our very first original today, so you can see where we’re at in that cycle,” Sarandos added.
Optimised data use
Another hurdle is the price of data, which is often considered to be expensive for average South Africans, especially when it comes to data-hungry applications like streaming.
Sarandos said that Netflix’s streaming technology accounts for situations where data availability may be limited.
“Remember that Netflix is pretty well-optimised for challenged markets, so it works very well at slower speeds. Offline downloading really was developed for this use.”
“What we found was that in countries that are more developing, they adapt their behaviour so that when they have Wi-Fi they do a lot of things quickly,” he said.
“So your ability to download offline quickly and watch on mobile is second to none.”
The price of Netflix’s packages could be a stumbling block for some users in South Africa and Africa in general.
To highlight this, The Pirate Bay currently shows that Queen Sono is being downloaded illegally less than a week after its release.
Leading star Pearl Thusi even pleaded with a fan on Twitter to not download an illegal copy and emphasised that the success of the show may be measured by numbers on the platform itself.
Sarandos said that although Netflix has applied a broad pricing structure across various territories, this will likely change.
“To date, our pricing is pretty much one-size-fits-all, but that clearly is not going to be our Africa strategy for long. Basically, recognising the local economies will be important to us.”
He said that what people are willing to pay is tied closely to the value offered, which is why they want to emphasise providing quality content before addressing pricing.
In order to ensure it is properly prepared for the roll-out of region-specific pricing, Netflix wants to establish a bigger footprint in Africa when it comes to content.
“We have tried to focus on the local value first and then try to fine-tune the local pricing,” Sarandos said.
The account-sharing problem
Sarandos further acknowledged that the practice of account sharing – wherein one Netflix subscriber shares their login details with multiple people – can be the result of unaffordable pricing.
Sarandos said that a “part of account sharing is a signal of desirability” and that many were doing this not out of “unwillingness to pay, but sometimes an inability to pay”.
“It’s up to us to meet the challenge with pricing packages that fit the market better,” Sarandos stated.
Original African content
Netflix’s African Originals form part of the company’s broader focus on sourcing content from non-traditional international markets, such as Latin America and Asia.
It started this program in Mexico in 2015 with the release of Club de Cuervos and plans to produce 130 seasons of local language original series in 2020.
On 27 February, the company premiered Queen Sono – a South African production which was shot in several countries on the African continent.
“It has an all-African cast, crew and writers, and was filmed in 37 locations across Africa,” Ghetubba explained.
Netflix plans to debut three new African shows in 2020.
This includes South African teen drama Blood and Water, Zambian animated show Mama K’s Team 4, and the as-yet-untitled Nigerian “Akin Omotoso Project”.