Analyzing Netflix's Recent Moves in the Streaming Video Landscape
The current Streaming Video landscape is as dynamic as ever - with services continuing to balance subscriber growth and profits alongside the potential fallout from password crackdowns, price hikes, and the introduction of ad-supported (AVOD) tiers. We examine the effects of Netflix’s recent password crackdown and price hike in this post - suggesting a more aggressive recent price hike timeline, increased success in converting subscribers to their AVOD tier, and a step change in the scale of password sharing crackdowns.
Percentage of eligible subscribers notified
Source: Email receipt data
NFLX initiated a price hike on its Basic and Premium plans on 10/18/23. Through the first 13 days of notification emails, we estimate ~40% of subscribers have been notified, well above the 21% and 25% after a comparable number of days post notification for price hikes in 2020 and 2022, respectively. Additionally, notifications this year began 2-3 days earlier than the previous two price hikes.
Cumulative subscribers updates after price hike / Total notified subscribers
Source: Email receipt data
We observed a ~3X increase in customers updating their plans after the most recent price hike, as compared to previous price hikes, while subscriber churn has remained at similar rates.
Plan updates to AVOD tier
Data is displayed on an indexed average daily basis.
Source: Email receipt data
The increase in plan updates is likely being driven by updates into the AVOD tier, including from the Standard tier (even though there is no price hike on Standard).
US NFLX T7D gross additions vs cancellations.
Source: Email receipt data
Netflix sent the largest password crackdown email notification round in UCAN since May on 11/1. We estimate ~80% of the 30mm identified UCAN password sharing households have now been notified. Gross additions have accelerated slightly following the last round of notifications.
YipitData’s coverage of Streaming Video trends includes Disney+, Hulu, Max, Discovery+, Paramount+ and Peacock also. Our use of email receipt data offers unparalleled granularity allowing us to track the success of strategic initiatives - key to building out the most effective long term.
