A new business report shared by the brokerage Needham and Co has come out with a prediction that says Netflix could be losing almost 4 million subscribers next year. The streaming giant is facing increased pressure from the increase of new streaming service offerings including Disney Plus and Apple+. The main issue hurting Netflix is the price point. Most other services are cheaper than Netflix.
This has given the other streaming services the nickname "Netflix killers."
Netflix's price is keeping customers away
The shocking prediction was made by Needham & Company's Laura Martin. Martin spoke to Bloomberg and emphasized that Netflix is failing to compete on price with other streaming options, such as Disney Plus and Apple TV+. Disney Plus is currently priced at $6.99 a month and Apple TV is offered at $4.99 per month. This is cheaper than what Netflix is currently offering at $8.99 and a second-tier plan at $15.99 per month.
Laura Martin said Netflix could right the ship and save their subscribers by offering a cheaper plan, possibly between $5 to $7 per month, in order to be closer to what Disney, Apple, and the upcoming NBC Peacock services cost.
NBC has yet to announce what the cost will be for its upcoming streaming platform, but it's rumored to be less than Netflix's basic plan. They could possibly consider an ad-supported plan. An ad-supported plan would help Netflix keep its market value and survive the ongoing "streaming wars," while also competing in the lower price bracket.
Netflix not in favor of possible 'Netflix with ads'
Netflix once considered a "Netflix with ads" option, but now say they are not planning to add commercials. However, Netflix could benefit from the revenue generated by ads. Netflix adding ads would be a difficult sell to its current members. Screenrant reports that a study was undertaken and reported that the streaming giant could end up losing almost 57% of its current subscribers if commercials were added to the service.
Netflix streaming subscriber numbers are being outnumbered by those of rival services, as they continue to spend huge money investing in regional and international content on its platform.
The news comes a day after Netflix claimed the majority of Golden Globe nominations, earning 17 in TV categories and 17 more for movies, including the recently released "The Irishman." Just this week, Netflix shares fell to $294.50. They may need to consider a new way to attract new subscribers as well as keeping current subscribers. Martin also said that the loss of hit TV shows including "Friends" and "The Office" to its competitors could hit the company's value over time. We will have to wait and see how they survive the ongoing "streaming wars."