Netflix posted a big earnings miss yesterday as it reported that it lost 200,000 subscribers in the January to March quarterly window, the opposite of the constant growth it wants to see. That was actually more pronounced in the US and Canada where it lost 640,000 subscribers in the quarter, offset by gains in the Asia Pacific market. Wall Street analysts can parse their own reasons for these losses, but if you’ve used the service and its competitors recently, you’ll know that the answer is pretty clear.
Netflix is Too Expensive
Like a frog boiling in water, Netflix has been constantly increasing its prices over the years to the point where its “premium” subscription, which offers four screens of play, a must for many families, and 4K content, is $20 a month.
That’s higher than any of its rivals by a significant margin. Such as:
Disney Plus - $8 a month
Apple TV+ - $5 a month
Hulu (No Ads) - $13 a month
HBO Max (No Ads) - $15 a month
Amazon Prime Video - $9 a month
Paramount Plus (No Ads) - $10 a month
The “mid tier” of Netflix is $15 a month, but that knocks out 4K content, which many of these others have, and takes you down to just two simultaneous screens. “Basic” at $10 a month doesn’t even have HD content, which is a setting that doesn’t even make sense in 2022.
Netflix absolutely has the numbers and market share advantage here. Even with the unexpected loss, they still have 221.6 million worldwide subscribers, with about 75 million in the US and Canada. That is still far more than rivals have reported. Hulu has 45.3 million while HBO and HBO Max have 46.8 million subscribers. Disney Plus has 42.9 million subscribers in the US and Canada. Paramount Plus has 32.8 million subscribers. Apple, on the rise with arguably the highest quality content lately, has only 8.1 million subscribers via the last analyst estimates.
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