The pandemic gave Netflix a massive boost in popularity. As more citizens became trapped at home, the streaming giant's massive collection of content enticed millions to pick up the service. However, not all seems right at home as subscribers are starting to depart. Is the honeymoon period over?
Netflix losing subscribers
Reported by Ars Technica, the streaming giant haemorrhaged over 400,000 subscribers in the US and Canada this quarter. The sizable loss resulted in Netflix providing investors with lower predictions for the rest of the year, 3.5 million growth instead of 5.9 million.
In an investors call, Netflix explained that the loss in subscribers isn't due to the large number of streaming rivals popping up. Despite massive growth from Disney and a healthy startup from HBO Max, Netflix doesn't see these competitors as an issue.
Netflix co-chief executive Reed Hastings explained:
“Does HBO or Disney... have a differential impact compared to the past? We’re not seeing that in the [data] we have. That gives us comfort.”
However, the streaming service did admit that “the pandemic has created unusual choppiness in our growth”.
The streaming service is still growing, just not in the United States and Canada. Worldwide, the streaming service saw an extra 1.5 million users join the service. However, the lack of home-soil members is a curious event.
Video games might be the answer
Netflix does appear to have a trick up its sleeve. In the midst of competition, the online film venture is starting a new division. Instead of just offering movies, the streaming giant will also be introducing video games as part of the normal subscription.
Instead of starting a new service just for video games, the company will include them free of charge. Furthermore, the company will start of initially with mobile titles and then branch out over time if growth is sufficient.
Netflix is keen to state that they’re not moving into a video game company. Video games are just an extension of the streaming service. As Netflix puts it: “We’re a one-product company with a bunch of supporting elements.”
For the time being, Netflix is still the king of streaming. At almost 210 million paying users, the service has double the amount of subscribers as Disney Plus. But will the massive horde of new streaming services negatively affect Netflix?