Netflix lost subscribers for the first time in more than a decade in the first quarter of 2022, according to the number of subscribers the company said Today’s Earnings Results, Netflix has lost over 200,000 subscribers, and the losses will continue.
Netflix expected to add 2.5 million subscribers in the first quarter of 2022, but fell short of that target. The suspension of its business in Russia cost it 700,000 subscribers, and without that loss, Netflix would have added 500,000 paid global users, which is still well below its estimates.
In the United States and Canada, Netflix lost 600,000 subscribers due to recent price changes. Netflix said this subscriber loss was anticipated and in line with expectations.
in a letter to shareholders [PDF]Netflix said revenue growth “has slowed significantly,” with the company blaming “a large number of account sharing households” and “competition” as reasons for the decline. Netflix estimates that it has 222 million paying households sharing with an additional 100 million homes that are not being monetized.
Going forward, Netflix said it plans to implement “more effective monetization of multi-household sharing”, suggesting that Netflix will soon take measures to stop account sharing. In March, Netflix began testing additional payments for people who share their Netflix accounts with people outside of their homes.
In Netflix’s current test markets of Chile, Costa Rica and Peru, subscribers can pay an additional fee to share their account with up to two people outside of their home country. When the trial began, Netflix said it was working to “understand the usefulness of these two features” before making changes in other countries.
Netflix has always included words in its terms and services that forbid the use of accounts in many households, but until now, the service has neglected sharing passwords. Netflix recently increased the new prices, with a 4K streaming plan priced at $20 per month.
It is worth noting that Netflix is the only streaming service that charges for the streaming quality. In the US, Netflix charges $9.99 for a Basic plan without HD that allows streaming on a single device, $15.49 for a Standard HD plan that allows two people to watch at the same time, and It’s $19.99 for the Premium plan with Ultra HD streaming and support. For up to four spectators at once.
In the second quarter of 2022, Netflix is projected to lose two million paid subscribers. To offset the ongoing losses, Netflix co-CEO Reed Hastings said that in addition to addressing the password sharing issue, the company is looking at a more affordable, ad-supported plan in a year or two.