Analyst Says Netflix Could Lose 4 Million Subscribers Next Year

While Netflix has had a firm grip on the streaming industry for the last several years, there are finally a few competitors rising up to challenge the service. Disney+ saw 10 million subscribers sign up in its first 24 hours, a number that will only continue to grow over the years thanks to its wildly popular library of Marvel, Star Wars, and Pixar projects. In 2020, WarnerMedia will launch HBO Max and NBCUniversal will launch Peacock, both of which should have a significant impact on the market. The streaming landscape is about to be more crowded than ever before, and Netflix will need to adapt if it wants to continue thriving.

Disney+ costs half of the most common Netflix subscription, and still doesn’t include advertisements. Peacock is rumored to be a free service. HBO Max will cost a tad more than Netflix, but that includes the incredible slate of HBO programs. Price is now an issue for Netflix, as all of its competitors can either offer a better price, or at least an incentive to sign up for their service. According to Needham analyst Laura Martin (via Market Watch), the not-so-competitive prices could cause Netflix to lose as many as four million U.S. subscribers next year.

This would be a major blow to Netflix, as those subscribers would likely be leaving the service to sign up for another one. The trouble is, Netflix pays for so much original content that a cheaper price point may not be possible. So how can it remain competitive?

Martin argues that the solution for Netflix could be as simple as introducing ads. Netflix users would likely panic of advertisements were ever introduced on the service, but this wouldn’t be for all plans. Netflix could introduce a cheaper subscription, somewhere in the range of $5-$7, that would include ads, while keeping the current tiers without them.

No one wants to watch advertisements while streaming, but folks hoping to subscribe to multiple different services would have the option to fit more within their budget if Netflix had a cheaper option. This would also allow Netflix to gain some extra revenue.

At the end of the day, it doesn’t matter how Netflix alters its strategy, but some sort of change will need to be made as other major services arrive online.

Do you think the other services pose a threat to Netflix? Which ones are you subscribed to? Let us know in the comments!