Netflix cut-price package goes down well

If the current market backdrop isn’t stimulating enough, investors are certainly sitting back with the popcorn watching Netflix with interest.

Pricing details of its new advertising-backed subscription package went down well with the market, sending its share price up 5%. It is hoped that a cheaper offering will reignite subscriber growth and stop customers from leaving during the cost-of-living crisis. It’s better to keep people at a lower price than lose them altogether.

AJ Bell’s Russ Mould said: “That’s fine during hard times, but when the global economy is starting to look stronger Netflix will almost certainly want to get more money out of its customers.

“It’s easy to get hooked on a diet of discounts and customers might not find the advertisements before a show or film too distracting, so there is a risk that they stay on the lowest subscription package permanently.”