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Netflix shares are down 70% this year. They have fired more than 500 employees. In the first quarter of 2022 they lost 0ver 200,000 subscribers. In 10 years Netflix had never lost subscribers in any quarter ever but in 2022 they did and chances are things could get worse.

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So why exactly is Netflix under performing? Here the main reasons why our favorite blockbuster channel is loosing it.

  1. The market is saturated. when streaming, netflix has a monopoly, it stood alone in this view world market but thats no the case any more. Now the market has many other options. Disney has its own streaming platform so those HBO, Warner Bros etc… so the customer has more options to choose from. This competition is eating into netflix’s revenue. for example disney plus wont buy netflix any more, they buy disney plus.
  2. The price difference. The Netflix subscription is alot more expensive compared to the other platforms. Is it worth it? perhaps, but is it an absolute necessity?  No its not especially when there’s a global cost of living issue so many house holds are cancelling their subscriptions. Infact data from the United Kingdom shows that in the last quarter 1.66 million subscriptions were cancelled, the reason higher cost of living. The data also found that younger people were more likely to cancel subscriptions (Under 24 age groups). In Britain, they are shifting to free services like Youtube and Tiktok.
  3. Password sharing. Alot of people pigback on their friends’ netflix accounts. Basically they share the same account. Imagine this happening on a global scale and think about how many subscriptions Netflix is loosing.
  4. Lack of Creative content. Netflix is dragging out classic shows squeezing out every bit of mileage from their flagships. But that squeeze has a cost, alot of viewers are loosing interest and instead they are exploring other options and platforms.

So the above quite explains precisely why Netflix is tanking. But do they have a plan to tackle this?

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