The Big Mac Index’s successor: Netflix subscription prices

For years, the “Big Mac Index” served as an indication of the cost of living and purchasing power in different countries around the world. However, perhaps it is time for a more contemporary comparison. Introducing: The Netflix Index.

Your capital is at risk. Other fees apply. For more information, visit etoro.com/trading/fees.

Just like the McDonald’s Big Mac, Netflix subscription prices vary by country. Therefore, if we use subscriptions as a benchmark, the EUR/USD exchange rate should be 1.13, EUR/GBP at 0.75, and the EUR/CHF at 1.1. Due to the GBP rate, the British pay less for the basic Netflix plan than Americans, or even the Poles. The Swiss pay the most, regardless of plan.

The Netflix Index

By comparing the subscription prices in different countries, we can infer the supposed “currency rates” Netflix used to convert prices. For this comparison, we reviewed the three tariff plans available in all countries, which differ in price and image quality level. 

Prices of Netflix services in different countries (monthly subscription in local currency)

  Basic picture quality Standard (HD) Premium (4K)
Germany 7.99 EUR 12.99 EUR 17.99 EUR
US $8.99 $13.99 $17.99
UK 5.99 GBP 9.99 GBP 13.99 GBP
Switzerland 11.90 CHF 16.90 CHF 21.90 CHF
Poland 34 zł 43 zł 52 zł

Prices Adjusted to Euro

  Basic picture quality Standard (HD) Premium (4K)
Germany 7.99 EUR 12.99 EUR 17.99 EUR
US 7.49 EUR 11.66 EUR 14.99 EUR
UK 6.97 EUR 11.62 EUR 16.27 EUR
Switzerland 10.82 EUR 15.36 EUR 19.91 EUR
Poland 7.47 EUR 9.45 EUR 11.43 EUR

For our comparison, we will use the cheapest of the plans, Basic, which costs 7.99 euro in Germany. In the US, where Netflix has the most customers, the same plan costs $8.99, or 7.49 euro after conversion. And for the price of this plan in Germany and the US to be the same, the EUR/USD should be at 1.13. Currently, it’s at 1.2, which is 6.2% more.

At the current rate of the Pound, the British pay less for the basic Netflix subscription than any other customers in our comparison – just 6.97 euro. In order for the prices in the UK and Germany to equalise, the EUR/GBP should drop from the current rate of 0.86 to 0.75. 

The Swiss pay the most for Netflix, no matter the plan. Currently, the EUR/CHF exchange rate is around 1.1. However, in order for the price of the basic Netflix plan in Switzerland and Germany to equalise, the EUR/CHF exchange rate should be 1.49, which is well above the Swiss Central Bank’s dream of the ideal Swiss franc exchange rate. Closer to this level is the premium plan, which would be evened out at EUR/CHF 1.22.

The weakening of the Polish Zloty means that when paying for Netflix in this currency, you pay more for the basic package than in the UK and almost the same as in the US. In order for the price in Zloty and Euro to level out, the EUR/PLN should drop from the current 4.55 to 4.26. Poles, on the other hand, have the cheapest premium package, and in order for its price to match, the EUR/PLN would have to drop to 2.89. This is well below the historical minimum of PLN 3.20 per Euro, recorded on 30/07/2008.

Your capital is at risk. Other fees apply. For more information, visit etoro.com/trading/fees.

Whether or not this new index will overtake the Big Mac Index remains to be seen. However, it is still interesting to examine how prices for seemingly equal services vary based on each country’s currency. 

Please note: The comparison didn’t take into account the fact that Netflix’s movie and show offering vary from country to country. The market exchange rates used for this article were taken on April 19, 2021, at 14:00 GMT.

Zero-commission means that no broker fee will be charged when opening or closing the position and does not apply to short or leveraged positions. Other fees apply. Your capital is at risk. For more information, visit etoro.com/trading/fees.

33162 views