There has been a recent report about Netflix losing a lot of subscribers and is expected to lose millions more over the next few months. This is something that’s quite surprising because of the fact that Netflix is still the most prominent name in the streaming industry and still has one of the best libraries of originals. In that regard, why has Netflix lost so many subscribers, and how will that affect its future?
Netflix lost subscribers partly due to the fact that it pulled out from the Russian market when the Ukraine war broke out. On top of that, it has increased its prices and has been locking down on account sharing. Canceling shows and a smaller number of franchises are probably good reasons as well.
It isn’t rare for us to see media companies suddenly falling after such a fast rise, as this was what happened with Blockbuster years ago. Then again, Netflix and Blockbuster are entirely different from one another. But it is still interesting to look at what we know about Netflix’s recent losses and what that means for the future of the streaming giant.
Why Is Netflix Losing Subscribers?
The one big name that has led to the rise of the streaming wars today is Netflix, which is still the biggest name in the streaming industry because of how it started as the first true giant in this style of entertainment. Of course, Netflix has had a lot of different shows and movies that have allowed it to become as big as it is.
Still, despite the popularity of Netflix, there is a report that it lost 200,000 subscribers all over the world, and that made people wonder why that has happened. On top of that, there is speculation that Netflix is set to lose two million more subscribers in the next few months, as it has become clear that the streaming giant is losing its hold on a market it once had an iron hold on. So, why is Netflix losing subscribers?
There is no one true reason that we can look at when it comes to the subscriber losses that Netflix has seen lately. However, there are a lot of different factors that have all combined and contributed to this phenomenon. And let’s take a look at them.
The Russian war
Like a lot of different companies that serve global markets, Netflix pulled out from Russia when the war on Ukraine broke out. There are hundreds of thousands of subscribers in Russia, and that means that suspending those accounts in Russia has contributed to the large decrease in subscriber count that Netflix has seen during the first quarter of 2022. This was something that the company anticipated, as it could have been more than possible that its subscriber loss could have been minimized had the Russian war on Ukraine never happened.
Price increase and account sharing crackdown
Of course, there’s also the fact that Netflix has been increasing its prices. A price increase is natural today because the only way for Netflix to continue to bring in more movies and shows and better-quality titles is by increasing prices. That said, some households aren’t able to afford the price increase, and that has led to people canceling their subscriptions.
Then we may want to look at the fact that Netflix has also been cracking down on account sharing. Plenty of people have been sharing their accounts with family and friends, but Netflix has found measures to decrease that and to actually implement affordable packages that would allow them to convert these households into subscribers as well. Still, not a lot of people can afford their own subscriptions.
Over the past few years, notable names have also entered the streaming industry by creating their own streaming services. This became evident when Disney launched Disney+ and pulled their movies and shows out of Netflix. Of course, names like Amazon Prime Video, Hulu, and HBO Max have also been threatening Netflix.
And the aspect that has made these names more enticing to some subscribers is the fact that they also include packages like sports in their streaming services. That means that people who enjoy other types of entertainment can benefit more from these streaming services.
Then again, these names also have series and movie franchises that people find more enticing than what Netflix has to offer. For example, Disney has Marvel and Star Wars. Meanwhile, Amazon has Lord of the Rings. The most notable name that Netflix has is Stranger Things, which doesn’t have the same impact that Marvel and Star Wars have.
No room for growth
Of course, it is also possible that Netflix has already peaked in its growth. It has already reached the countries that it was supposed to reach and has already enticed the subscribers it was meant to entice. This means that there is no longer any room for Netflix to grow as it has already reached its peak state. The only thing that it needs to do now is to make sure that its subscribers stay.
What Is The Future Of Netflix?
At this point, it really is difficult to assess the future of Netflix, considering that it still is the most dominant name in the streaming industry. In terms of its library, Netflix still has the biggest selection of movies and shows that different people will love. While it doesn’t have franchises that it can stick to when trying to attract people to stay or subscribe, the vast amounts of choices that vary in terms of their genre are still better than what other streaming services can offer.
We are projecting that Netflix’s hold over the streaming industry will somehow find a way to normalize to the point that it will no longer be as dominant as it once was. Today, it still holds a huge lead over Amazon Prime Video, but we believe that the losses will pile up to the point that its lead won’t be as huge as it once was before.
That said, we also believe that the subscriber losses will end up normalizing as well and will also reach their peak until only those who have been loyal to Netflix will remain. Right now, Netflix has a hold that’s somewhere above 25%, but that could drop down to 20% and remain there as different streaming services are still increasing their hold over the market.
This means that people shouldn’t worry too much about Netflix, as there are no indications that it will turn into the next Blockbuster. Netflix isn’t like Blockbuster because it actually innovates and hasn’t rested on its laurels. However, the future remains to be seen, especially when technology is still improving and can eventually find a way to change the way the streaming industry works.