(Source from Reuters/Alamy)Within the last few months of 2022, popular streaming service, Netflix, has been undergoing major changes with its staff and subscription services. Back in May, the company let go of about 150 employees, most of them being based in the U.S., and then an additional round of layoffs occurred in late June. This shocked the public as Netflix has housed many well-received shows and movies in the past couple of years, even expanding internationally.
The layoffs, according to Netflix, were a result of a slowing revenue growth while costs continue to trend upwards. A majority of the cuts were made within the U.S., which came as a surprise to many since the streaming platform housed an abundance of hit original series and films. Even recently, the newest season of popular Netflix series “Stranger Things” was released, amassing 1.15 billion hours viewed in total.
Despite shows like this receiving an overwhelmingly positive response, it seems as though Netflix is pulling back on investing on resources that are not bringing in the revenue stream they want to see. In fact, the major streaming platform is now set to increase the costs of their subscription service. The basic plan will rise from $8.99 USD to $9.99 and the standard plan is now set to be $15.49 instead of $13.99; the premium plan is nearly $20. This isn’t the first time Netflix has increased their monthly subscription prices, but with the U.S. being hypersensitive to inflation and talks about a recession, people are not happy with the news.
Netflix, however, is aware that these changes may downsize their customer base. In order to make their platform more accessible, they are in talks to potentially introduce ads into their subscription service as a way to invite new users who may not want to pay extra for an experience without advertisements. Even one of their major competitors, Disney+, is also considering an ad-supported tier, confirming that this may be the route many other streamers decide to take in the near future.
With the news of downsizing staff and subscription changes, there have been many who expressed their growing dissatisfaction with Netflix as a whole. In just the first quarter of 2022, the streaming platform lost approximately 200,000 subscribers in the United States. This is the first significant drop in customers in about a decade.
This loss could be attributed to other major streamers such as HBO Max, Apple TV, Hulu, and Disney+ taking over the market as those platforms continue to release original content just like Netflix has. Another factor could be that more and more users are relying on shared accounts rather than purchasing their own subscription due to price constraints and overall convenience.
Existing customers are also beginning to question the sporadic rotation of content, where certain movies and shows that aren’t owned by Netflix are only available for a few months before being taken down their roster. This leaves them no choice but to subscribe to other streaming platforms that may have content that they are actually searching for and having them rely less and less on Netflix for consistent entertainment.
Overall, many changes are in the works for Netflix, and while things may be slowing down in the U.S., there is still hope for foreign markets as the streamer continues to expand globally.
JULIE KIM
ASIA JOURNAL
