Friday, April 12, 2024

The four causes of the crisis (and the solution to get out of it) –

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from Lorenzo Nicolau

Since January, 200,000 subscribers are down and -22.5% on Wall Street. Among the reasons, the end of the shutdown and the increasingly fierce competition: the US company is considering advertising

It seems that the largest distributor of film, TV and electronic content has come on its own The first setback. After a glorious decade I brought him Netflix To reach the desired share of 222 million subscribers All over the world, it is now facing its first moment in 2022 which started very badly for the American giant. in the first quarter 200,000 subscribers less that it Wall Street stock’s vertical collapse by 22.5%. The numbers that overturn the most optimistic forecasts, which are a prelude to More subscriber loss in the next few monthsThe. Currently, the streaming platform reports that the slowdown is mainly due to Service suspension in RussiaBecause The conflict in UkraineIn addition to Difficulty reaching new subscribers. in California headquarters Los GatosHowever, leaders are well aware that what could be a physiological slowdown, after presenting its first series in 2013, house of paper and published approx 126 original series and movies of 2016with a market capitalization of i 138 billion eurosIt could now be the beginning of a much darker period than the last happy years.

Prediction: 2 million fewer subscribers in 2022

For the first time since its birth (1997), Netflix is ​​losing users rather than gaining them. Reporting the results of the first quarter of 2022 to shareholders, as required by US legislation on listed companies, immediately had an impact on the stock exchange, where in the past months much more optimistic forecasts were announced, with Expected growth of 2.5 million subscribers before the end of the year. We must refer not to the unpredictable conflict, which led to the abdication of 700 thousand subscribers in Russia, but to a result United States and Canadawhere is the The loss was 600,000 subscribers. A statistic indicating that the situation should not improve in the short term, but should worsen, with revisions of estimates with expectations that could be those of Losing 2 million subscribers in 2022.

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the reasons

Despite the constant war, I There are four reasons for this crisisSome of them are linked together. more Subscription priceit’s me Perhaps the most realistic and immediate, because not everyone has accepted or could have accepted the increase. Economic hardship has led many to abandon the service because current conditions, compared to the past few years, offer alternative solutions to Netflix. Pandemic and lockdown The number of members inevitably increased, but in recent months people have been less connected to local realities as the health emergency has faded, and have devoted themselves to other things in their spare time. Similarly, the emergence of platforms such as Disney + and Amazon Prime Video, give users a choice. in both cases Subscription cost is much lower (€8.99 per month or 89.99 per year for Disney+, only €36 per year for Prime, whose subscription also includes free e-commerce shipping) for An increasingly rich and rich offering. Powerful competitors backed by equally great facts are crumbling the monopoly that has characterized Netflix for the past decade. Last but not least, practice Massively offensive postmaking of 222 million official subscribers more than 320 million active content users. According to these figures, one in three users will be “locked”, due to the sharing of the subscriber’s personal credentials with friends, relatives and acquaintances. phenomenon which The company has begun to put an end to it only recently.

Netflix counter-moves to win back subscribers

Taken together, these reasons have relentlessly stalled the growth of Netflix, which is now bringing life to the Immediate and timely reaction (Also deeply investigate users’ reaction by introducing new codes, such as the double thumb). Reiterate the success and records in the first 28 days of programming content such as squid game (142 million users), Bridgeton (82 million) And the magician (76 million), looks really tough right now. In some cases, give users the opportunity To change the end of a string This is clearly not enough, while the most popular solution to reduce the cost of subscriptions would be Ad entry. This was said by the co-founder and CEO of the broadcasting giant Red Hastingsperhaps explaining the opportunity to enjoy a program Contents at lower prices, if you accept ads. Currently the cost range is From 7.99 to 17.99 € per monthDepending on which profiles can be activated and which devices can be used at the same time, but new solutions may arrive throughout the year. This will not be the first case of commercials within broadcast content, because in Italy Pluto TV (Free thanks for advertising) e kilo With some free movies shown, they have always given space for promotional ads. The spread of the platform in many countries also gives a glimpse into the possibility of producing and distributing increasingly customized content, defined according to geographical regions, but such a possibility would certainly not be without additional costs. Finally, children aged 14-25 invest most of their time in video games and watching interesting content. tik tokAnd Twitch And Youtube. Netflix has already created a section dedicated to gameswithout asking for an additional cost, but the effectiveness of this selection in terms of subscriptions has not yet been tested.

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Apr 20, 2022 (change on Apr 20, 2022 | 12:07 PM)

Wynne Dinwiddie
Wynne Dinwiddie
"Infuriatingly humble alcohol fanatic. Unapologetic beer practitioner. Analyst."
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