Despite Lex Netflix, streaming does not have to become more expensive
The "Lex Netflix" will soon be put to the vote. The initiative demands that streaming providers invest in Swiss film. Figures from Moneyland.ch show that they can afford to do so.
On May 15, 2022, Swiss voters will vote on the new film law. The main topic of the vote is whether streaming services will have to invest four percent of their local revenue in Swiss films.
The extent to which the new law would affect individual providers depends on two factors: How many paying customers they have and how high the prices of the respective streaming provider are. Moneyland.ch has compiled an overview of this.
Netflix has 3.4 million users
Netflix continues to lead the way in Switzerland, as Moneyland.ch's 2021 streaming study shows: 54 percent of Swiss*s say they watch Netflix. In contrast, the other foreign streaming services have much smaller user numbers: 13 percent of respondents watch Disney Plus, 10 percent Amazon Prime Video.
Converted to the Swiss population, this means that five of the most popular paid streaming providers in Switzerland had a total of around six million users in 2021. At 3.4 million, Netflix accounts for more than half of these.
However, it is unclear how many of these users actually pay for a subscription. This is because some streaming subscriptions can be used on multiple devices and some people also share their login with friends. The Moneyland.ch survey at least shows that 55 percent of Swiss people pay for at least one streaming service. For example, 39 percent of the population use a paid Netflix subscription.
4.99 euros to 24.90 francs per month
Netflix is not only at the forefront in terms of user numbers, but also in terms of prices, as a comparison by Moneyland.ch shows. The provider charges its customers up to 24.90 francs per month. The cheapest providers in Switzerland are Netzkino Plus at 4.99 euros and Apple TV plus at 6 francs per month.
When comparing prices, it is important to keep in mind that the offerings of the various streaming services are not identical: Some movies are only available on Netflix, others only on Disney Plus or Amazon Prime, because many streaming services rely heavily on exclusive series and movies. Netflix became big with this strategy, and Amazon Prime Video, Disney Plus, and Apple TV Plus are now doing the same to the industry leader.
"A low-priced streaming service is of no use to a customer if the series he or she wants is not available via that streaming service," says telecom expert Ralf Beyeler of Moneyland.ch. "Viewers therefore either have to pay the price charged or do without the corresponding series and films altogether. Or they watch the content together with people they know."
Lex Netflix could make millions
The user figures and prices show one thing above all: The Lex Netflix has its name rightly. The 4 percent that streaming providers would have to invest in Swiss film is likely to be a large amount, especially for Netflix. To be sure, Netflix does not publish official figures on its sales in Switzerland. But if we assume that half of the 3.4 million Swiss customers pay for the cheapest Netflix subscription, that would mean annual revenues of roughly 240 million francs for the provider. 4 percent of that is almost 10 million francs.
By way of comparison, if half of the users of the second-largest streaming provider, Disney Plus, were to pay a subscription, that would mean annual revenues of around CHF 64 million. Four percent of that is 2.6 million francs.
Overall, the Federal Office of Culture estimates that the adoption of the law will result in CHF 18 million in additional funding flowing into Swiss film projects and co-productions.
Will this cause prices to rise?
Opponents of the law fear that the investments prescribed in the Lex Netflix will lead to an increase in subscription prices. The providers have not yet confirmed this, but they lobbied against the new law, in some cases fiercely, as early as 2021.
"The big providers like Netflix would not be forced to raise prices," Benjamin Manz, managing director of Moneyland.ch, points out. The foreign providers earn much more money per customer in Switzerland than in other countries, without suffering from high location costs. A Netflix subscription in Germany, for example, costs 7.99 to 17.99 euros. Swiss customers pay the equivalent of around 40 percent more than German customers. Compared to the U.S., it's circa 30 percent. "Netflix could easily afford the four percent," says Manz.
In recent years, providers have already continuously increased their prices in Switzerland. "It is quite conceivable that streaming prices will continue to rise," says expert Beyeler. However, it is questionable whether the Netflix lex will really be the decisive factor. After all, streaming providers like Netflix have also seen price increases in other countries in recent years - including in Switzerland's neighboring countries. In addition, a similar investment obligation already exists in countries like France - but a Netflix subscription is still much cheaper there than in this country.
