According to 01Net’s 25% of subscribers want to cancel their subscription
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Netflix should continue to lose subscribers. According to a study, a quarter of American customers want to cancel their subscription. Subscribers point to several factors, including rising prices.
Reviews.org, a non-profit company that specializes in testing products and services, has surveyed 1,000 Americans about their streaming habits. According to the survey, the average person subscribes to four different VOD services.
Unsurprisingly, Netflix is the most popular streaming service in the United States. 77% of respondents subscribed to a Netflix subscription. It is also the most viewed platform in American homes, ahead of HBO Max and Disney+.
“70% of respondents watch Netflix most often, meaning the service is used more than any other streaming service”underlines the report of Reviews.org.
Despite its great popularity, Netflix is experiencing an erosion of its customer base. During the second quarter of the year, the service was deserted by 970,000 subscribers. During the previous quarter, more than 200,000 customers worldwide had already canceled their subscription. Since the beginning of the year, 1.2 million subscribers have therefore given up the platform.
According to the Reviews.org report, the Netflix subscriber exodus is set to last. One in four subscribers plans to cancel their subscription by the end of the year. In other words, Netflix could soon be deprived of 25% of its American clientele.
Read also: Netflix is counting on the death of TV channels to revive its growth
Repeated price increase
More than 40% of subscribers who plan to cancel their subscription believe that the service has become too expensive. In recent years, Netflix has gradually increased its prices. In France, the catalog is now available at the starting price of $8.99 per month. The most complete offer, with 4K and several screens simultaneously, is now priced at $17.99 per month. A similar increase was applied in other countries, including the United States. Netflix attributes this umpteenth increase to account sharing, a widespread practice that would weigh heavily on its revenues.
Reviews.org’s finding is shared by analysts at Attest, a consumer research firm, reports Forbes. Firm CEO Jeremy King says subscribers are ” currently very sensitive » to price increases, even the smallest ones. 19% of Netflix subscribers who plan to cancel their package point the finger inflation and the general increase in the cost of living.
“This could explain the subsequent drop in viewership on the platform last quarter, especially as inflationary pressures have further reduced Americans’ purchasing power and incomes.”explains the leader of Attest.
Note that Netflix remains the most expensive VOD service of the American market. As Reviews.org points out, the average monthly cost of a subscription in the United States is $15.15. For its part, HBO Max costs an average of $12.49, compared to $7.99 for Disney+.
To respond to the haemorrhage of its subscriber base, Netflix has planned to launch an affordable subscription supported by advertising. This offer would be offered at a monthly price between 7 and 9 dollars. It would therefore be slightly cheaper than the standard plan current from Netflix, priced at $9.99 in the United States. Note that this subscription will not give access to the entire Netflix catalog. In addition, certain functions, such as offline downloading of films and series, would not be offered. The plan would be deployed by the end of the year in certain countries.
However, price is not the only factor causing subscribers to jump ship. Indeed, 21% of deserters regret that they can no longer find the program they want on the platform. Lately, many contents have disappeared from the catalog. Warner Bros repatriates indeed a plethora of films and series to enrich its own service. Cult programs, such as Fight Club, A Prince in New York, Man of Steel or the Hobbit trilogy are also preparing to leave the catalog on September 30.
The scarcity of new Netflix productions has also contributed to the disenchantment of subscribers. The health crisis has indeed forced the VOD giant to postpone the shooting of several expected productions. This is particularly the case of Stranger Things, whose season 4 was not released until 2022, i.e. three years after season 3. De facto, the catalog was not sufficiently supplied for several months to support growth. .
The VOD market, a sector that has become very competitive
Of course, Netflix also suffers from the rise of competition. As Netflix continues to lose customers, a service like Disney+ is attracting more and more subscribers. The Disney giant’s platform recently passed the milestone of 137 million members worldwide, despite the announcement of a future price increase.
For Jeremy King, the wave of unsubscriptions affecting the VOD leader also indicates ” the potential end of Netflix’s monopoly on the streaming industryg ». In this context, alternative services, such as Disney+, HBO Max or even Hulu, could find a more substantial place.
“Competition has never been so fierce”underlines Jeremy King.
Faced with this fierce competition, Bog Iger, former CEO of Disney, is convinced that not all platforms will manage to do well. In his view, there are currently too many players on the market. While considering that ” Netflix will continue to thrive” despite his current worries, he prophesies the disappearance of certain competitors in the years to come.