Asia Press Agency

Tag: Subscribers

  • Netflix’s Crackdown on Password Sharing May Lead to Price Hike

    Netflix’s Crackdown on Password Sharing May Lead to Price Hike

    Netflix’s recent crackdown on password-sharing has likely contributed to the addition of approximately 6 million subscribers in the third quarter, positioning the streaming pioneer to consider price increases. Although Netflix has stood as the only profitable major streamer, it has resisted raising ad-free prices this year. Instead, the company has aimed to curb password-sharing beyond households to tap into the more than 100 million viewers who use its service without subscribing.

     

    “Netflix now closely resembles a utility in many markets,” noted analysts at Bernstein. However, this utility status brings challenges, especially for a maturing company in finding avenues for continued growth.

     

    The possibility of raising prices is expected after the end of the recent Hollywood actors’ strike, which saw the Writers Guild of America (WGA) approving a new contract with major studios.

     

    Despite the turmoil caused by the strike, Netflix has weathered it effectively, thanks to its extensive international presence and strong content lineup. However, its ad plan, introduced last year, had a slow start. To encourage more subscribers to opt for ad-free options, analysts anticipate that Netflix will raise the prices of these plans in the coming months. So far, most viewers who subscribed to Netflix after the password crackdown have chosen ad-free plans. The standard plan with ads is priced at $6.99 a month, while ad-free plans start at $15.49.

     

    “Using these tactics, Netflix’s will likely double its ad-supported viewership next year,” according to Insider Intelligence analyst Ross Benes. He predicts that Netflix will increase the number of ads shown to users over time to compete with its rivals.

     

    The ad tier is projected to generate approximately $188.1 million in revenue in the third quarter, along with an estimated 2.8 million subscriber additions, as per Visible Alpha estimates.

     

    Overall, Wall Street anticipates that Netflix will report its strongest quarterly subscriber additions this year, mainly due to robust programming, including the latest seasons of “Sex Education” and “Virgin River.” It is estimated that revenue in the third quarter grew by 7.7% to $8.54 billion, marking the fastest growth in five quarters.

  • Password-Sharing Crackdown- Netflix gains 5.9 Billion Subscribers

    Password-Sharing Crackdown- Netflix gains 5.9 Billion Subscribers

    Netflix revealed on Wednesday that its crackdown on password-sharing has yielded remarkable results, leading to an impressive increase of 5.9 billion subscribers. As of the end of June, the streaming giant boasted a staggering 238.4 million subscribers worldwide, and it anticipates similar growth during the July-September period.

     

    This substantial surge in subscribers represents Netflix’s best performance in the second quarter since the extraordinary 10 million subscriber gain in 2020 under vastly different circumstances. In their shareholder letter, Netflix management attributed this success to the crackdown on password sharing, which has resulted in a “healthy conversion of borrower households into full paying Netflix memberships.”

     

    Building on this momentum, Netflix has decided to expand its password-sharing crackdown to all markets across the globe, including countries like Kenya, Indonesia, and India. The company is now taking an assertive approach to ensure that its accounts are exclusively used within a single household.

     

    In particular, Netflix emphasized its focus on India, a significant market for the streaming platform. In an official statement, Netflix announced that it will send an email notification to members who are found to be sharing Netflix accounts outside their households in India. By taking this step, Netflix aims to enforce its policy and uphold the integrity of its services.

     

    Netflix’s crackdown on password sharing commenced in May, compelling users who shared accounts outside of their homes to pay an additional fee. Interestingly, this move enticed droves of users to sign up for Netflix’s more affordable ad-tier base, generating a positive response from the audience.

     

    Amid these developments, Netflix discreetly eliminated its basic $9.99/month plan in the US and UK. Instead, the company now focuses on promoting its ad-supported tier and premium plans, bolstering its revenue streams.

     

    The combination of its successful password-sharing crackdown, strategic pricing changes, and global expansion has positioned Netflix for continued growth and dominance in the streaming industry. As the company seeks to stay ahead of the competition, its approach to user authentication and pricing models will play a pivotal role in shaping its future trajectory.