Netflix has lost 200,000 subscribers. The streaming platform shared the news in its first-quarter earnings report. Though it may seem nothing compared to the 22 million subscribers it has, this is the first time it has lost so many subscribers. And it has also estimated to lose around 2 million more in the next quarter. So, what could be the reason, the biggest streaming platform is now losing its customers. Netflix ruled the world of online streaming for a while, but now the wind is changing direction. There are a few reasons why the streaming platform is losing customers. We have listed five alarming ones below.
Netflix lost customers due to the end of the lockdown
Once the world was shut down due to the COVID-19 pandemic, people were stuck at home. So, they became dependent on streaming platforms, mostly Netflix as the source of their entertainment and timepass. But now, everything has reopened and people are returning to work again. Also, the cinemas are reopening too, so now streaming has again been sidelined somewhat. People now have less time to binge-watch the latest content the streamer offers. Despite the return of Bridgeton and a promise of season 2 of Squid Games, the subscriber count went down at the beginning of 2022.
The production shutdown due to the pandemic
While the customers were busy enjoying the old content available on Netflix, the lockdown had halted the shooting of most future projects. This only delayed the upcoming seasons of the fan-favorite shows. Stranger Things season 4 is coming in May, which is almost three years after the previous season. So, the fans of these shows canceled their subscription and decided to wait till a further season comes out to renew it again. Fans find it a better option than staying a customer and spending money all the while they wait. Hence, this became a huge reason why Netflix lost subscribers.
Netflix increased the subscription charges in January
In January, Netflix decided to increase the subscription charges. The basic plan went up to $9.99 and the top tier plan went up to $19.99. This is when the streaming company lost most of its subscribers. According to the data, 3.6 million people canceled their plans in January after the price hike. This is almost a million over the cancellations in the first quarter of 2021 and the last quarter of the year. And after that, the cancelation rate, aka Churn, has only spiked every month by 0.95 points.
Netflix is not getting new subscribers
According to the data by Similarweb, the number of people canceling is way higher than the number of people subscribing in the first quarter of 2022. Also, the streaming platform had declined by 16%. and cancelations went up by 61%. The percentage of new subscribers has gone down compared to the past two years. And has had the lowest number of unique visitors compared to other OTT platforms. This also indicates that it will have trouble finding subscribers in the future as well. There was a slight jump when the Oscar nominations came out.
Competitors are coming up with better options
Newer streaming platforms coming up, the competition is rising. The competitors are bringing out better content at cheaper rates. Plus, Netflix lost a lot of its Marvel content to Disney+. Subscribers are leaving Netflix for much cheaper options and the content quality is better as well. According to Eric Sorensen, an analyst at Parks Association, “Competition is fierce, and instead of other services attempting to gain ground on Netflix, it is Netflix that must discover creative strategies to maintain its leading position in the industry.”