Streaming giant Netflix is continuing to shed subscribers and is set for another huge financial loss by year’s end.
According to reports, the service is facing the biggest drop in subscribers in the company’s history.
A survey conducted by Reviews.org of 1,000 U.S. subscribers of Netflix conducted last month revealed that one in four current Netflix customers are planning to cancel their membership by year’s end because of the streamer’s continually rising monthly rate, which is currently $15.15 without ads, The Daily Wire reported.
If that figure holds, it would mean a loss of around 18 million subscribers and a revenue decline of around $272 million, the outlet added.
The survey noted that Netflix’s basic one-screen plan increased by 11 percent in January, the first such increase in three years. Meanwhile, the standard and premium plans went up by 20 percent and 25 percent respectively in the same period, making Netflix subscription rates the highest among the eight leading streamers in the U.S.
In the survey, another one-in-three respondents said they planned to ditch the service because it lacked engaging content, while 30 percent said they just prefer other streaming services.
The Daily Wire notes further:
In recent years, Netflix lost some of its licensing of television and movies to other platforms such as Warner Bros. Discovery’s HBO Max, Walt Disney Company’s Disney+, and NBCUniversal’s Peacock.
Earlier this year, Netflix released “better-than-expected” results in its second quarterly report, which showed the streaming service only lost about half of the two million subscribers projected initially earlier this year. However, the report showed approximately 970,000 subscribers canceled their membership during the spring and summer months. The number comes after the service took a massive hit in the first quarter when it lost 200,000 subscribers between January and March.
Netflix execs blamed lost subscribers in the third quarter on competition with other streamers as well as a hefty amount of content sharing, the war between Russia and Ukraine, and a downturn in the global economy. Company officials also alerted shareholders to the fact that as the U.S. dollar gets stronger and currencies around the world weaken, Netflix’s international market, which consists of about 60 percent of the company’s revenue, is likely to become disrupted.
“We’ve been through hard times before,” the company said in a shareholder letter. “We’ve built this company to be flexible and adaptable, and this will be a great test for us and our high-performance culture.”
Company execs also said that they are planning to introduce an ad tier system in a few markets where ad spending is greatest.
“Like most of our new initiatives, our intention is to roll it out, listen and learn, and iterate quickly to improve the offering,” the shareholder letter stated.