The company blamed the drop on a number of factors, including its huge size, increased competition, the economy, the war in Ukraine, slowing rollout of broadband, and the large number of people who share their Netflix accounts with non-paying households. It also said the decision to close up shop in Russia cost the company 700,000 new additions.
In a surprise move Netflix executives said they were now open to adding advertising to the service – in return for a lower-priced subscription. Netflix co-founder and chairman Reed Hastings has long been opposed to adding commercials or other promotions to the service.
Our revenue growth has slowed considerably as our results and forecast below show. Streaming is winning over linear, as we predicted, and Netflix titles are very popular globally. However, our relatively high household penetration – when including the large number of households sharing accounts – combined with competition, is creating revenue growth headwinds
On Tuesday, the OG streaming giant announced that it is losing, rather than gaining, subscribers for the first time in a decade in a letter to shareholders. To be exact: 200,000 subscribers have fled the platform which went from 221.84 million paying members last quarter to 221.64 this quarter.
‘And allowing consumers who would like to have a lower price, and are advertising-tolerant, get what they want, makes a lot of sense.’ At the moment, there’s no advertising at all on the service. Viewers can jump into and out of shows or movies instantly. That experience goes partly into the monthly pricing structure. But, there may be another reason Netflix wants to be able to offer a lower-priced tier – to keep more people using the service.
Shares of Netflix fell as much as 27% to $256 in extended trading after the streaming leader reported financial results that fell short of forecasts and said it expects a second straight quarter of customer losses.
For those wondering if people would actually watch an ad supported @netflix, 36% of over 500 respondents to this LI poll I ran recently said they would take an AVOD over SVOD model if given the chance.#Netflix #AVOD #SVOD #Streaming pic.twitter.com/yJodQSbH3t
— Paul Gubbins (@Gu881n5) April 19, 2022