Data shows that long-term subscribers are abandoning Netflix
A new independent survey shows that Netflix’s most loyal users accounted for almost 13 percent of account cancellations in the first quarter of 2022. Recently, Netflix reported its first decline in subscribers in more than ten years and announced that it lost around 200,000 subscribers in Q1 2022.
According to data from Antenna (via The Information), an analytics firm that anonymously gathers data about streaming habits from millions of American homes, loyal Netflix subscribers who had an account for more than three years accounted for 13 percent of cancellations in Q1 2022. The data also shows that cancellations have risen over the past two years and that Netflix is struggling to retain users for longer durations.
Of course, there are several reasons why this could be happening. But the easiest explanation is that the streaming market has become more congested since Netflix first started. Not only that, but the competition has also gotten bigger and better. In the past few years, we have seen the likes of Disney+, HBO Max, Peacock, Paramount Plus, and more gain traction. One of the many reasons behind this shift could be the cheaper ad-supported subscription plans offered by some of these services. Netflix is reportedly working on a similar offering, and it could arrive by the end of this year.
Netflix has also continued to raise its prices. While this wouldn’t be a problem if done strategically, the frequency of the price hikes hasn’t gone down well with subscribers. While content quality is subjective, many believe that the TV shows and films on Netflix are not as “must-see” as they used to be, with some of its tentpole shows taking longer to produce and release. Lastly, Netflix has admitted that password sharing on the service is a huge problem. Unfortunately, its recent problems appear to be the tip of the iceberg, as the firm has warned that things could worsen, with losses in the millions next quarter.
For many years, Netflix CEO Reed Hastings has discussed why Netflix doesn’t need to compromise its service with an ad-supported tier. But due to the company’s recent struggles, Hastings has changed his tune. According to sources, Netflix could introduce a new ad-supported tier by the end of the year. The introduction of a cheaper entry point into the service could be an excellent way to attract new subscribers, especially if it arrives during the holiday season when most streaming services see a massive bump in viewership. Of course, only time will tell whether Netflix can turn things around or not.