Neil Cybart 2/24/23 Neil Cybart 2/24/23

Netflix Slashes Pricing in Dozens of Countries, YouTube’s Market Positioning (Daily Update)

Hello everyone. We begin with Neil’s thoughts on Netflix cutting prices in more than 100 territories. It is quite the surprising development. The discussion then turns to YouTube and where the streaming service sits in the broader video streaming industry. Will YouTube’s market positioning shift with the company moving deeper into paid video? Will YouTube run into user resistance as it looks to evolve beyond being a source of free, ad-supported content?

Let’s jump right in.

Netflix Slashes Pricing in Dozens of Countries

A long-term trend in paid video streaming has been higher pricing. We can go so far as to say price increases were the big trend in 2022 as companies prioritized revenue and profitability.

As a sign of how the streaming industry is far from settled, Netflix is trying something new in 2023. Here’s the WSJ:

“Netflix Inc. has reduced the cost of its service in more than three dozen countries in recent weeks, as it tries to appeal to customers around the world who have an ever-growing list of streaming options.

The streaming company’s recent price cuts span Middle Eastern countries including Yemen, Jordan, Libya and Iran; sub-Saharan African markets including Kenya; and European countries such as Croatia, Slovenia and Bulgaria.

In Latin America, nations including Nicaragua, Ecuador, and Venezuela have seen reductions in subscription costs, as have parts of Asia including Malaysia, Indonesia, Thailand and the Philippines.

The cuts apply to certain tiers of Netflix in those markets—in some cases halving the cost of a subscription.”

This is a surprising development. It is the opposite of what Netflix management talked about on its most recent earnings call. While management teams are not obliged to follow product strategy discussed on earnings calls, the breadth and magnitude of these price cuts strongly support the view of a strategy shift being in play.

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Neil Cybart 1/9/23 Neil Cybart 1/9/23

Apple Bows Out of NFL Sunday Ticket Bidding, YouTube Wins NFL Sunday Ticket, YouTube Moves Deeper Into Paid Video (Daily Update)

Hello everyone. Welcome to a new week.

In today’s update, we will circle back to some big Apple news that came out as we were entering the holiday break. The update begins with Neil’s thoughts on Apple bowing out of NFL Sunday Ticket bidding. The discussion then turns to YouTube winning NFL Sunday Ticket, and what the move tells us about Google’s changed strategy.

Apple Bows Out of NFL Sunday Ticket Bidding

In an article published on December 16th, here’s ProFootballTalk:

"The company once regarded as the frontrunner for NFL Sunday Ticket has opted to take a Sunday drive, instead.

Buried in an item on Puck.news from Dylan Byer and Julia Alexander regarding recent changes at the top of Disney is an NFL bombshell: Apple has bowed out of the bidding for the out-of-market package the DirecTV will relinquish in only 23 days.

Here’s the key quote, from Byer: 'I’m now told that Apple, once seen as a frontrunner for the rights, has also backed out of those negotiations - not because they can’t afford it, but because they don’t see the logic. So it’s down to Amazon and Google, and there’s certainly a logic there for both companies: Amazon can use it to drive Prime subscriptions; Google can use it to fuel its YouTube TV business.'"

The fact that this bidding war had lingered into December was a clue that things weren’t going in Apple’s direction. For being the front-runner, ongoing negotiations pointed to the NFL and Apple not seeing eye-to-eye on various fronts. As for those sticking points, here’s The Athletic:

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