Netflix

22 Dec 2019

It is time for Netflix look abroad: growth slows down in America

In a later article, we told our readers about the strategies that made Netflix a rentable marketing platform. Today, on the other hand, we will concentrate on presenting problems that the company is facing. It is a fact that it is slowing down in the United States, and any business should understand what is happening. Learning about big companies help the smaller ones to prepare in advance for adversities.

Actually, the problem that Netflix is facing is not a profitable one. Profits continue to rise, but the subscriber base expands more slowly than expected. Now the consumer has other streaming services with similar features, such as Apple, Disney, HBO, and Amazon. Now that each one is developing its own series and movies, competition is getting harder in a land where Netflix used to reign.

Netflix
Netflix slows down in America. Understand why. (Source: Pixabay)

Netflix issues are getting harder

Something that Netflix has been doing successfully is the production of its own TV series. Titles as Stranger Things, The Crown, Queer Eye, and Money Heist are just some of the examples we can use to make our stand. However, it would be considered to be naive to think that the formula would not be repeated someday. After Netflix’s successful public acceptance, other streaming services came into the scenario.

HBO, for instance, is known for producing excellent TV shows, but one would have to wait days or weeks to watch shows like Game of Thrones. Now, this is something you can do easily because HBO has its own streaming service. Even companies that did not have the habit of producing movies or shows, such as Amazon or Apple, are investing in their own productions to capt new subscribers.

Because of that, despite the so waited launch of the latest season of Stranger Things, subscriber growth was lower than expected. The numbers are dropping. While Netflix added 517,000 domestic subscribers in the third quarter of 2019,  it had forecast about 800,000 new subscriptions. Internationally, Netflix added 6.8 million subscribers when they expected at least 7 million.

As you can see, it is not the case that the company is going bad. There are great subscription numbers to consider, but competition does cause an impact. Other companies’ services are cheaper and their original productions are going pretty good. That being the case, it would be interesting for Netflix to lower subscription fees. Besides, investing in more of the good productions it already has is a must. What do you think?