Netflix is facing the worst time of its streaming service since its launch in 1997. As the technology and streaming services are competing against each other, Netflix is facing a drastic fall in new subscriptions and even losing long-term subscribers.
The American online streaming service lost 200,000 subscribers in the first quarter of 2022. The predictions and calculations, instead of showing some progress in the next quarter, had shown even a worst-case scenario. In the next quarter, it is expected that Netflix will lose over 2 million subscribers. According to a report from The Information, those who’ve canceled their subscription to Netflix for over three years are counted as over 13%. This is an alarming situation for Netflix.
The subscription cancellations are increasing constantly and can put in danger the major profit of the Netflix’s streaming service. We can see from Netflix’s stock, which is down by 25%, that the American streaming service is in great danger. Let’s know why Netflix’s long-term subscribers are canceling their Netflix subscriptions.
Netflix canceling shows
One of the rock-solid reasons too many subscribers are canceling their Netflix subscription is the cancellation of Netflix shows. The online streaming service displays a customized list of TV shows, films, and anime series according to the person using it. Sometimes the fans get mad about the decision of Netflix to cancel a particular show. Recently, because of the decreasing number of Netflix subscribers, Netflix canceled some of the most famous shows, such as Archive 81 and many more.
These abrupt cancellations create resentment in Netflix subscribers. They don’t feel good about it and, as a result, leave the online streaming service for something else. Even most of the Netflix shows are accessible through Hulu and peacock and from other online resources. It is also a fundamental reason for increasing Netflix Subscription cancellations.
High Netflix Subscription prices
Who would like to use the Netflix Subscription to watch the Netflix Shows that one can watch at a lower price on other online streaming services? It’s simple, every customer on the earth would love to enjoy the lower price services with high quality. When Netflix skyrocketed the subscription prices, subscribers would find new avenues for their entertainment instead of sticking to Netflix only.
Hulu is an online streaming service just like Netflix, which is changing far less. Its monthly subscription price is $6.99. Whereas Netflix is charging $9.99 per month, which is higher than Hulu. The price hike is also a fundamental reason Netflix’s long-term subscribers are canceling their Netflix Subscription.
Netflix suspended its services in Russia
Netflix was once a crown of online streaming services. It entertained viewers around the world through a perfectly enticing cinematic experience. However, 2022 is a rough year for Netflix, as Netflix is losing long-term subscribers at a drastic rate. In the first quarter of 2022, Netflix lost 200,000 subscribers for the first time in a decade, which was a terrible blow. Moreover, it is expected that in the second quarter of 2022, Netflix will lose another 2 million Netflix subscribers.
No one factor is contributing to the declining reputation of Netflix. A vortex of challenges and problems has impeded the progress of Netflix. Recently, Russia started a special operation under the command of Vladimir Putin. To show solidarity with Ukraine, America put heavy sanctions on Russia and tried fully to curtain its power as much as possible.
Under this maximum pressure policy, Netflix also took part and suspended all services in Russia. With this, Netflix loses all 1 million subscribers from Russia. To compensate for this mega-loss, Netflix increased the subscription prices, which further increased the Netflix Subscription cancellations.
Ad-supported cheaper Netflix Subscription
One deadliest thing which Netflix is going to do is to provide a cheaper Netflix Service with an ad-supported version. This ad-supported version of Netflix will be cheaper as compared to the current ad-free Netflix version.
Co-CEO Reed Hastings said that the company doesn’t need to add this ad-supported version. As it can further reduce the efficacy of Netflix as compared to its competitors such as Hulu, Peacock, Disney, and others. We’ll see these changes at the end of this year or next year.
Wrap up
Netflix also started a crackdown on users who shared their accounts with other people. This was also a threat that could increase the cancellation rate of Netflix Subscription. However, Netflix is conscious of the steps it has taken and is now trying hard to contain everything.
Recently, Netflix ran out a test feature in Chile, Peru, and Costa Rica. It will allow the Netflix subscribers to add “sub accounts” for anyone using the service outside of their household. Moreover, Netflix is also working on LiveStreaming. To catch up with other online streaming services, Netflix has to do more to keep the subscribers list high.