Netflix: The Stream King

Netflix is an interesting and innovative company. The company has built a media empire for years. As a result, it is the largest subscription service for providing streaming movies and TV episodes over the internet. Throughout its lifespan Netflix has continued to grow as a company, which enabled growth in the market. They have employed several strategies to evolve the company over the years. One way Netflix innovated early one was to end the practice of charging late fees, allowing customers to keep the videos as long as they liked for the monthly fee.

Netflix being sued?

Netflix is being sued by its own shareholders over their subscriber slump. According to IGN, the lawsuit alleges Netflix violated U.S security laws by making “materially false and/or misleading statements” to its shareholders and “failed to disclose material adverse facts about the company business, operations and prospects.” Netflix blamed increased competition and password sharing and inflation, as well as the ongoing Russian invasion of Ukraine for its lack of subscriber growth.

Subscriber Drops

The company recently announced that they have lost 200,000 subscribers. Netflix is slashing animation amid subscriber drops. After highly publicized subscriber losses, Netflix is “putting the brakes on its animation efforts,” IGN reported. They are firing executives, and canceling several highly anticipated shows. Some of the projects aimed at families and kids have been outright canceled.

Netflix has just under 149 million subscribers; compare this to the under one million subscribers that Netflix had back in 2007. Netflix has been finding out that people have been sharing their accounts, so there may be as many two or three times more people that use Netflix but with a shared account. Although people are sharing their account with other users, Netflix subscriber counts have historically continued to increase. For the first time ever, in the first quarter of 2022, Netflix lost subscribers. According to Variety.com, Netflix lost 200,000 subscribers. This can be attributed to two causes: increased subscription prices, and the crackdown on password sharing. Many subscribers are put off by the constant increases, and long-time password sharers no longer see the value in Netflix. Netflix will have to figure out some way to lure more subscribers in, because otherwise they will be in danger of collapse.

Netflix Market Cap

Netflix went public in 2002 and had a market cap of about $300 million, according to Yahoo Finance. Companiesmarketcap.com reports that “as of May 2022 Netflix has a market cap of $81.51 billion.” You can definitely say Netflix has made some very good improvements over the past two decades. Netflix yearly earrings in 2018 were 16.61 billion dollars. The company is so valuable now because it generates a massive amount of revenue. Revenue figures may be lower than some of the bigger players in Silicon Valley but Netflix is still one of the heavy hitters in today's tech-based economy.

Original Content

Netflix spent 12 billion on original content in 2018 and has been doing really well because it has been investing steadily in their original content. It has seen that people will watch new things and also old things. Original content makes up about 80 percent of the U.S views. Netflix started out mailing people copies of already existing titles and now it generates revenue by producing and offering its own content. Although people originally signed up for Netflix just to see content they've seen before, their increased original content is becoming more important to subscribers.

Netflix Competition

In 2018, Netflix won more Emmy awards than HBO. People were at first skeptical of the quality Netflix original programming was going to have when it first came out to the public. Netflix surprised the public and showed that they had the right quality and were perfect for families and friends. Netflix took home more Emmy awards than HBO which had won the most at the annual television award ceremony for several of the previous years. Thanks to all the original content that Netflix has it has been a really big step for the app and it has raised the views for it as well.

Conclusion

Netflix, with its millions of subscribers and billions in revenue, is the biggest of the streaming platforms. It earns billions of dollars in revenue each year and is worth even more billions of dollars. Although recent trends put Netflix in a bad place, with losing subscribers, it is a stretch to say the giant streaming service is in danger. Netflix invented the subscription streaming service, and they remain the king of the industry.