Sarah Whitten, reporting for CNBC:
Netflix on Tuesday reported a loss of 200,000 subscribers during
the first quarter — its first decline in paid users in more than
a decade — and warned of deepening trouble ahead. The company’s
shares cratered more than 25% in extended hours after the report
on more than a full day’s worth of trading volume. Fellow
streaming stocks Roku, Spotify and Disney also tumbled in the
after-hours market after Netflix’s brutal update.
Netflix is forecasting a global paid subscriber loss of 2 million
for the second quarter. The last time Netflix lost subscribers was
October 2011. [...]
Co-CEO Reed Hastings said the company is exploring lower-priced,
ad-supported tiers as a means to bring in new subscribers
after years of resisting advertisements on the platform.
Netflix previously told shareholders it expected to add 2.5
million net subscribers during the first quarter. Analysts had
predicted that number would be closer to 2.7 million. During the
same period a year ago, Netflix added 3.98 million paid users.
That’s a big miss — expecting to add 2.5 million subscribers and instead losing some, and now expecting to lose millions next quarter.
Here’s one spitball idea for what’s wrong: too much focus on quantity of content and not nearly enough on quality. My wife and I have been slowly watching old seasons of Seinfeld on Netflix when we have nothing else to watch, or just want to watch one more easily-digestible show before going to bed. But it occurred to me this week that we haven’t watched anything else on Netflix in weeks. Just old Seinfelds. We’re watching lots of stuff on HBO Max and Apple TV+, and some new movies on Disney+, Hulu, and even Paramount+ — but not Netflix. This is a sample size of one family of three, but at this point, if we were forced to drop one of our streaming subscriptions, Netflix might be the first to go, based purely on what we’re actually watching. It seems weird that the only thing we’ve watched recently on Netflix is a sitcom from 25 years ago. The last Netflix original I can recall watching was (the admittedly very good) Don’t Look Up, and we’re looking forward to the final episodes of Ozark. But right now HBO Max has The Batman, Disney+ has all their recent theatrical releases and The Kenobi Chronicles coming soon, and Apple TV+ has Slow Horses and Severance. (Severance is probably my favorite show or movie in years — it’s so fucking good.)
The average quality of the average Netflix original just isn’t very good compared to their competition — not enough to justify the highest subscription prices in the industry.
★ Tuesday, 19 April 2022