Record high Netflix subscriptions, imminent password crackdown
Netflix Smashes Records with 232.5 Million Subscribers, and Ad-Supported Tier Going Brilliant
Ace stuff from Netflix as they revealed that the number of subscribers reached a staggering 232.5 million in the first quarter, setting some serious records. Not only that, their swanky new ad-supported tier is getting a thumbs up from tv lovers.
The streaming titan flexed those financial muscles with a quarterly profit of $1.3 billion. Smashing, huh? Hold your horses, though – they’ve pumped the brakes on a big crackdown on account password sharing. Why? They want to make the experience for members even more top-notch.
Netflix said they’re expecting to kick off paid password-sharing options in the coming months.
“Managing the fallout from the new strategy is clearly high on Netflix’s agenda,” said Third Bridge analyst Jamie Lumley.
Some perks for members and revenue gains from this move have been put on hold, according to a Netflix letter to stakeholders.
Netflix has already dabbled with testing “borrower” or “shared” accounts in certain locations, but plans to roll them out in the USA and elsewhere soon, said Netflix co-chief exec Greg Peters, while having a natter during a streamed earnings chit chat.
The streaming giant is taking its time to ensure that subscribers have easy access on various devices, whether it’s a tablet, TV or smartphone, so the experience is as smooth as silk.
Bossman Peters said, “Taking a bit of extra time to apply those know-hows ensures a smoother transition for our loyal members.”
Early signs for Netflix’s new ad-supported subscription tier are looking pretty fab – engagement is better than they dared hope and there’s “very little swapping from standard and premium plans.”
Market gurus at Insider Intelligence reckon Netflix will rake in a cool $770 million in ad revenue from the new tier this year, and that figure will soar above $1 billion the following year.
As growth at Netflix eased last year, the California-based streaming behemoth turned its attention to creating a lower-priced subscription tier that included advertising.
The aim is to coax password-sharing freeloaders to pay up for the service without agitating subscribers too much.
“This account-sharing initiative helps us attract a larger base of potential paying members and take Netflix to new heights,” said co-chief exec Ted Sarandos.
For the first time ever, stats show that US adults will dedicate more time watching digital videos on platforms like Netflix, TikTok, and YouTube than watching traditional tv, according to Insider Intelligence.
Netflix and YouTube are neck and neck as leaders in digital video viewing, with the future of television forever evolving.
Analyst Lumley concluded, “Netflix subscriber growth shows the streaming wars are still on. The company is ahead of its game but still feeling the heat from all the players in this highly competitive arena.”
