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Netflix Stock Price Tanks As Customers Quit Over Higher Prices (theverge.com)

Posted by BeauHD on from the more-money-more-problems dept.

An anonymous reader writes: Netflix released its earnings report (PDF) for the second quarter today, where it reported $1.97 billion in revenue and net income of $41 million. The company did however report only 1.54 million subscribers, which is below its projections of 2.5 million new subscribers. As a result, stock is down around 14 percent in after-hours trading. "Our global member forecast for Q2 was 2.5m and we came in at 1.7m. Gross additions were on target, but churn ticked up slightly and unexpectedly, coincident with the press coverage in early April of our plan to ungrandfather longer tenured members and remained elevated through the quarter," Netflix wrote. "We think some members perceived the news as an impending new price increase rather than the completion of two years of grandfathering." The company defended its price hikes, writing that "while ungrandfathering and associated media coverage may moderate near term membership growth, we believe that ungrandfathering will provide us with more revenue to invest in our content to satisfy members, thus driving longterm growth." In the past, Netflix gained 13 million new subscribers in 2014, and 17 million in 2015. Comcast will reportedly allow Netflix onto its X1 platform, which may entice more customers to the streaming service.

13 of 460 comments (clear)

  1. The price hike is minimal... by myowntrueself · · Score: 5, Insightful

    The real reason for people leaving Netflix is the blocking of VPNs and proxies and the dull nature of Netflix original content.

    --
    In the free world the media isn't government run; the government is media run.
    1. Re:The price hike is minimal... by Anonymous Coward · · Score: 5, Informative

      Not to mention the inconsistent availability of third party content. Movies and shows get pulled seemingly at random, which is especially annoying if you are mid-season.

      It used to be better than torrents, not so much anymore.

    2. Re:The price hike is minimal... by pr0t0 · · Score: 5, Interesting

      and the dull nature of Netflix original content

      Different strokes. Personally, I'm loving their original content!

      House of Cards
      Orange is the New Black
      Daredevil
      Jessica Jones
      Sense8
      Marco Polo
      Love
      Peaky Blinders
      and now Stranger Things

      I've heard Bloodline is good, and Luke Cage is coming. Some of their comedy specials aren't too bad either. Ali Wong's "Baby Cobra"...I haven't laughed that hard in a while.

      For me, it's been a long time since I've been this happy with video content. I recently ditched cable and I'm not going back. Netflix is, at the very least, doing it as well as most anybody else is and without the support of commercial sponsors.

      How much time do you want to spend in front of a television anyway?

      --
      I'm sorry, but your opinion seems to be wrong.
    3. Re:The price hike is minimal... by chriskenrick · · Score: 5, Insightful

      Even more so in countries like Australia where our library is less than half the size of the US one. By blocking my access to other netflix regions, they're well on their way to losing another customer. I know it's the rights holders that are the issue, but the only language they understand is money.

    4. Re:The price hike is minimal... by Anonymous Coward · · Score: 5, Insightful

      Netflix would love to have more content, and especially better content. Its Hollyweed wanting to create an artificial scarcity of content to keep licensing fees far too high that is the problem... If Netflix could double the amount of QUALITY content that could be streamed from them, few would care if the price doubled! The reason for the content disappearing and missing seasons or episodes are licensing issues. Hollyweed is too greedy and thinks that their content is worth far more than it really is worth. Hollyweed and their crap licensing terms and high license fees are why we don't see more quality content on all video streaming services.

    5. Re:The price hike is minimal... by ranton · · Score: 5, Insightful

      Yeah all those ones you mention, I find pretty dull. Especially Dare Devil and Jessica Jones, normally I love action hero stuff but those just bore the pants off me. I tried Stranger Things recently, couldn't get past the first 30 minutes.

      Maybe I'm just strange.

      Even if you don't like these programs, the positive reviews from both critics and viewers objectively show they are quality content. If you had originally said you stopped watching Netflix because of dull original content that is your opinion, but claiming people are leaving Netflix because of that is simply objectively wrong. I'm not saying no one leaves because of dull original content, but clearly that is not a major driving factor.

      I find it more likely that emails notifying users about the price hike reminded people they were paying for Netflix when they were never using it. I've worked at two subscription based companies which avoided reminding users of their service like the plague since it only incited some users to cancel (I don't condone the practice, and yes one of the companies is bankrupt now).

      --
      -- All that is necessary for the triumph of evil is that good men do nothing. -- Edmund Burke
    6. Re:The price hike is minimal... by SuperKendall · · Score: 5, Insightful

      Unfortunately I find David Tenant utterly detestable.

      If that is the case then you REALLY need to see Jessica Jones.

      --
      "There is more worth loving than we have strength to love." - Brian Jay Stanley
    7. Re:The price hike is minimal... by Anonymous Coward · · Score: 5, Informative

      you didn't lose 1080p, you never had it. MS Edge increased resolution to 1080p while other browsers haven't, that is a reason it isn't gonna fly? everyone was always at 720p in browsers, MS proposed a tech that they got content providers to accept which allowed them to go to 1080p, other browsers can do exactly the same, this is not a MS exclusive deal. The others I agree with, VPN blocking and limited content is shit.,

    8. Re:The price hike is minimal... by Darinbob · · Score: 5, Insightful

      Amazon is still a wannabe player in the market. It's big market segment is people already subscribed to Amazon prime, they're not getting a lot of new customers. Their selection is really terrible, and if there's something good then chances are you may have to pay extra for it above and beyond the subscription.

    9. Re:The price hike is minimal... by mrbester · · Score: 5, Informative

      Peaky Blinders is original content? Might want to tell the BBC. Exclusive, maybe (except it is on iPlayer)...

      --
      "Wait. Something's happening. It's opening up! My God, it's full of apricots!"
  2. I'm about ready to drop by darthsilun · · Score: 5, Interesting

    Not because of the price, but because of the lack of content.

  3. Re:VPNs FTW? by GuB-42 · · Score: 5, Insightful

    Likely their crackdown on VPNs and foreign subscribers has also contributed somewhat to the churn.

    If they'd let paying customers, you know, be paying customers then maybe they'd be in a better position now.

    Probably not their decision. Netflix would love not to have any regional restrictions. Content owners and governments have other ideas.

  4. Re:It's A Bargain by Rockoon · · Score: 5, Insightful

    So you now don't get any news or sports channels, how great.

    Not getting FOX, MSNBC, ESPN, etc is a feature.

    --
    "His name was James Damore."