Despite churning out global hits like “Squid Game” in 2021, Netflix’s fourth-quarter returns show the streaming giant is struggling to maintain a competitive edge. The company fell short of its projections for new subscribers this quarter, adding 8.3 million versus a projected 8.5 million — it also expects to add just 2.5 million subscribers in Q1 2022, versus 4 million l last year (the company says this is because it has “a more weighted content slate in the background” for the quarter). Overall, this year marks a downward trend in subscriber growth – it’s the company’s weakest year of growth since 2015 and a decrease of around 50% from its numbers of 2020 inflated by the pandemic.
“Consumers have always had plenty of choice when it comes to their entertainment time – competition that has only intensified in the past 24 months as entertainment companies around the world develop their own streaming,” the company wrote in its letter to shareholders, admitting that “competition may affect [its] some marginal growth.
While Netflix has around 222 million total subscribers, larger conglomerates like Disney (which also owns Hulu and ESPN) have continued to grow at a more aggressive pace. Disney ended 2021 with 179 million total subscribers across Hulu, Disney+, and ESPN+, and it plans to double the number of countries in which Disney+ is available by fiscal year 2023. Disney also announced the creation of an international content and operations group to expand its direct-to-consumer streaming internationally. HBO Max is also growing – the company said December was its most-watched month since the service launched in May 2020.
Netflix last week announced plans to raise subscription prices in the United States and Canada, while in India the platform lowered prices in an attempt to attract more consumers after six tough years in the market. massive entertainment. Netflix is also experimenting with another new revenue stream: games. The company recently acquired game studio Night School and has been developing games based on its own intellectual property, such as the hit show “Stranger Things.” If this week’s biggest tech stories tell us anything, it’s that gaming can be very lucrative. As expected, Netflix announces that it will expand its games portfolio in 2022.
Another new avenue for Netflix to grow its subscriber base is through content marketing – the company launched a website called Tudum last month, hiring entertainment journalists and editors from publications like Allure, Vanity Fair and Bitch Media to share exclusive content on Netflix Originals.