By using this site, you agree to the Privacy Policy and Terms of Use.
Accept
CapitalatorCapitalator
Notification Show More
Latest News
‘Good night’: Uvalde school shooting survivors describe gunman’s words before opening fire
May 27, 2022
Aurora Cannabis Slashing Weed Capacity in Profitability Push
May 27, 2022
Elon Musk says it’s ‘dumb’ to call billionaires the bad guys
May 27, 2022
Warriors Payroll: Most Expensive Roster Leads Golden State To 2022 NBA Finals
May 27, 2022
Why CrowdStrike, MongoDB, and Datadog Spiked Higher Today
May 27, 2022
Aa
  • NewsLive
  • Business
  • Politics
  • Investing
  • Finance
  • Companies
  • Markets
  • Crypto
  • Careers
  • Climate
  • Life
  • Tech
  • Videos
Reading: Cost-conscious consumers are the problem for Netflix
Share
CapitalatorCapitalator
Aa
  • News
  • Business
  • Politics
  • Markets
  • Crypto
  • Companies
  • Finance
  • Investing
  • Careers
  • Climate
  • Lifestyle
  • Tech
  • Videos
Search
  • Categories
  • Bookmarks
    • Customize Interests
    • My Bookmarks
  • More Foxiz
    • Blog Index
    • Sitemap
Have an existing account? Sign In
Follow US
Capitalator > Technology > Cost-conscious consumers are the problem for Netflix
Technology

Cost-conscious consumers are the problem for Netflix

Alexander Müller
Alexander Müller May 14, 2022
Updated 2022/05/14 at 3:17 AM
Share
SHARE

When Netflix last month revealed that it had lost customers for the first time in a decade, you might have expected competing streaming services to be jubilant.

The giants of old media have in recent years made challenging Netflix a mission. Figures for the first quarter suggest they had some success: Netflix lost 200,000 subscribers, while Disney Plus added nearly 8mn new ones.

Even Netflix co-founder Reed Hastings, who for years has dismissed the fear that rival services posed a threat, admitted that they have “some very good shows and films”.

But data from Ampere Analysis suggest that instead of a new Pixar film or an HBO show luring viewers away, the pressure on consumers’ wallets was key to Netflix’s troubled quarter.

In the two weeks after cancelling their subscription to Netflix, 87 per cent of subscribers had not signed up to a rival service, according to the analysis, which is based on around 3mn US internet users.

Richard Broughton, director of research at Ampere, said that although there was an increase in churn rates at the start of the year, “there is no strong evidence to suggest that customers are being pulled away due to interest in other [streaming video] services”.

The data suggest that a combination of higher inflation and a weakening stock market prompted consumers to tighten their budgets.

Many of those that left the streaming service were aged between 18 and 24, or in households with an annual income of less than $15,000, according to the analysis. About 49 per cent of the poorest households surveyed said they had a Netflix subscription in the first quarter, down from about 56.2 per cent in the previous year.

Netflix’s loss of subscribers came after the company in January raised the price in the US for its standard plan by $1.50 to $15.49. 

While the analysis suggests belt-tightening was the biggest drag for Netflix, questions over its content may also have contributed.

Ampere’s data point to Netflix suffering from a growing number of more fickle subscribers, or those who will cancel a subscription if they cannot find anything they want to watch, but are willing to join again when they hear of something they do.

Although an industry-wide concern, Netflix’s maturity makes it more exposed to this risk than the rest, said Broughton.

Additional reporting and data visualisation by Steven Bernard

Alexander Müller May 14, 2022
Share this Article
Facebook TwitterEmail Print
Leave a comment Leave a comment

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

You Might Also Like

Technology

Uber and Lyft’s New Road: Fewer Drivers, Thrifty Riders and Jittery Investors

May 27, 2022
Technology

China Smartphone Demand Weakens Amid Covid Resurgence

May 27, 2022
Technology

CD Projekt: delays have switched shareholders off

May 27, 2022
Technology

Twitter refuses to remove Silver Lake’s Egon Durban from board

May 27, 2022

Capitalator

  • Business
  • Careers
  • Climate
  • Crypto
  • Finance
  • Investing
  • Markets
  • Technology

© 2022 Capitalator. All Rights Reserved.

Removed from reading list

Undo
Welcome Back!

Sign in to your account

Lost your password?