For the first time in Netflix’s history, the company has reported a loss of 200,000 to 300,000 subscribers.
The loss was reported last month and is a combination of long-time subscribers and newer subs. However, changes are coming says Netflix’s executive team. Maybe as early as the end of the month of May.
The streaming giant recently announced a few days ago that it’s laying off 150 employees, mostly in the U.S. Some projects, specials and original shows have been either canceled or put on hold indefinitely until further notice.
And with the current state, it may get worse before it gets better. Netflix is also forecasting another loss of upwards of $2 million subscribers in the coming next quarter. The streaming service accounts for this due to many factors including if not significantly blamed on password sharing.
I have Netflix, well over 5 years now, so I am definitely one of their long-term subs. And yes I pay for mine. The movies have changed over the years. There have been some shows that have disappeared that I loved. While others still remain that I don’t want to see leave such as, This Is Us, Breaking Bad and Better Call Saul. Of course, like many fans, I still watch them over again after taking long breaks from binging all of the episodes.
The growth of Netflix subscribers has been shadowed or even halted somewhat to fewer subs than what the company had predicted for 2022. This could be attributed too many things such as the Covid lockdowns from March 2020 until earlier this year. Households have been saturated with so many offers, promos and competing prices from rival streaming platforms such as Hulu and Amazon’s Prime Video. The choice selection process has never been so abundant.
So how did Netflix get to this point?
Well, when an extremely lucrative streaming service giant like Netflix is as successful as it is – it’s bound to face grey areas along the way. No ship has a perfect sail.
That said, as mentioned above, the password or account sharing has been an issue that has been overlooked for a long time. And crack downs are going to happen according to Netflix’s CEO & Co-founder Reed Hastings.
Last month, Hastings made a statement after Netflix released its first-quarter saying, cracking down on passwords sharing must happen. “We’ve just got to get paid, you know, to some degree for them.” It was reported that over 100 million people worldwide are sharing accounts and in North America (USA & Canada) between 30 to 40 percent are reportedly sharing passwords. Currently, there are approximately 75 million subscribers in the U.S. and Canada. Hastings has said that Netflix has been working on password-sharing solutions for almost two years.
During the years before 2011, Netflix took off, and took a huge bite out of the theater profits. The rest as they say was smooth sailing for a while due to their financial gain which exceeded expectations. Many original shows like Stranger Things and comedy specials such as Dave Chapelle were major blockbuster hits out of the gate.
However, that was then, this is now. Netflix is proposing that new changes are definitely around the corner.
Cinema goers will be happy to hear that Netflix executives are suggesting that their movies will get a 45-day release in theaters, before airing on Netflix. There is no better promotion than a theater release and even the streaming giant is financially aware of this. Having their movies run a little longer in cinemas will have an increase in revenues in a short time. In the past, Netflix has aired movies on their network after only a couple of weeks run in the theaters. That change will be significant in the next coming months. Summer is the season where movie goers flock to cinemas the most, according to industry sources.
The company is re-visiting the idea of launching cheaper-ad supported plans.
As of now, there are three tier plans and the prices for them have increased to $11.99 (from $9.99), Standard $15.49 (from $13.99) and Premium $19.99 ($17.99). We could see the new ad-service implemented within a couple of weeks according to sources.
In order for Netflix to rebound from their losses due to password-sharing, another idea is to add a lesser charge for account sharing or sub-accounts. So, as to not alienate potential subs who may want to try out the service before deciding to sign up for a full membership.
Adding livestream is another change Netflix is looking to make.
Similar to other streaming giants like Disney+, Amazon’s Prime Video and HBO Max, they are also sharing the loss of subscriptions since Netflix’s announced its shares fell 25% last month.
These changes are necessary says executives in order to face the competition from other popular streaming giants like Apple+, Prime Video and DisneyPlus. Netflix was founded by Reed Hastings and Marc Randolph. Currently, Netflix has over 221.6 million subscribers worldwide according to the recent company data as of March 2022.
Published by HOLR Magazine