Netflix Inc.'s new mobile pricing strategy in India should help the U.S. streaming giant further penetrate an overpopulated over-the-top market, analysts say.

The company is trialing a mobile-only subscription in India that costs half of its basic plan at 250 Indian rupees per month.

A Netflix spokesperson told S&P Global Market Intelligence that "we will be testing different options in select countries, where members can, for example, watch Netflix on their mobile device for a lower price and subscribe for shorter increments of time."

The spokesperson stressed the strategy's experimental nature. "Not everyone will see these options, and we may never roll out these specific plans beyond the tests," they said.

Netflix's paid international membership has grown steadily between 2016 and 2018. According to data compiled by S&P Global Market Intelligence using company filings, Netflix had 80.8 million paid international members in the fourth quarter of 2018, up from 32 million in the first quarter of 2016. The company's international subscription revenue has also increased in the same period to US$2.11 billion in the fourth quarter of 2018, from US$650 million in the first quarter of 2016.

Analysts say the new pricing tier is necessary to compete in India's crowded OTT market, in which roughly 30 foreign and local outfits participate.

"I assume the new pricing strategy will go on to be very successful in India, [where] local streaming services are generally cheaper. Clearly Netflix had to be more competitive," said Tony Gunnarsson, principal analyst at Ovum, who specializes in pay TV and streaming video.

The current market leader in the country is Star India Pvt. Ltd.'s Hotstar. The company had 75 million monthly active subscribers in India at the end of 2017, compared to Netflix's 5 million, according to tech consultancy Counterpoint Research.

Hotstar also recently announced a new subscription tier, priced annually at 365 rupees, which will include sporting events such as the Indian Premier League cricket tournament, the cricket World Cup and the English Premier League soccer matches.

Other players in India include Sony Corp.'s SonyLIV, Amazon.com Inc.'s Prime Video, Balaji Telefilms' ALTBalaji and Eros International's Eros Now.

Netflix's decision to provide a lower price point for mobile users will increase their addressable market because "internet access is an issue," said Michael Pachter, a video game, social media, digital media and electronics analyst with Wedbush Securities.

A report by Omidyar Network states that Indians spend 30% of their time-consuming media and entertainment when using their mobile devices.

Pachter believes the streaming giant is "doing poorly" in India and has therefore resorted to the "desperate" move of lowering its pricing tier in India to grow subscriber numbers.

At the end of the fourth quarter of 2018, Netflix had an estimated 4 million paid streaming subscribers in Australia, 1.29 million in Japan, 680,000 in New Zealand and 730,000 in India, according to data from Kagan, a research unit within S&P Global Market Intelligence.

Simon Murray, principal analyst at Digital TV Research said that while lower prices for mobile users may help to grow the subscriber base, Netflix still faces a number of hurdles in the country, such as battling advertising video-on-demand platforms and increasing its Indian original content.

In 2018, Netflix launched three local productions in India and in November, the U.S. streaming giant announced several new titles for its Asian viewers to expand original content operations in the region.

Earlier this year, Netflix also said it will reinvest profits from a recently announced price increase into its content, with a focus on expanding its local-language and international originals. It continues to tap debt markets to fund content expansion.

"I think that it will be hard for Netflix to grow its subscriber base to a significant level on its own. It might have more success if it joins forces with one or more sizable local players," Murray said.

As of March 25, US$1 was equivalent to 68.90 Indian rupees.