When it comes to Netflix, the streamer always comes across as an obvious winner. And why won’t it be, as given the insanely popular films and series that are a part of its library people must literally rush to be the platform’s subscribers, right? But apparently, this hasn’t been the ideal scenario for the streamer, at least not in 2021 as not only is Netflix losing subscribers but also its stiff competitor i.e., HBO Max is steadily gaining them.
As reported by Financial Times, HBO Max has signed up 2.4 million new US subscribers in the June quarter, which brings the total tally of its subscribers to 12.1 million, excluding the people who have free access to the platform via cable subscription. While the number of HBO Max subscribers has only increased in the past three months, hundreds of thousands actually went ahead and canceled their Netflix subscription. At the company’s company’s Q2 2021 earnings report (via Variety), it was revealed that the streamer has lost as many as 430,000 subscribers in the US and Canada.
If you look at the bigger picture, then Netflix’s subscriber base has only increased. Between Q1 and Q2 of this year, the streamer gained around 1.5 million subscribers. It currently has the reigning tally of 74 million subscribers in the US and Canada and 209 million subscribers across the globe in comparison to its rivals like HBO Max and Disney+. But it is the other side of the coin that is worrying- while the loss of subscribers isn’t that obvious, Netflix is definitely experiencing a decline in the incoming of new subscribers. For example, in Q1 2021, Netflix saw the addition of 4 million new subscribers compared to the 6 million the company had initially predicted.
According to Michael Nathanson, an analyst at MoffettNathanson, Netflix is experiencing its “middle age” in the US consumer market and is having trouble maintaining its position as a “first mover.” The company has accepted its current shortcomings during the Q2 earnings report call (via The Hollywood Reporter and Variety) where Netflix CFO Spencer Neumann admitted that they too have felt the financial impact of the coronavirus. Since the pandemic hit, Netflix has canceled many fan-favorite series to make budget cuts. The second reason for the decline in its number of subscribers, according to the streamer, is the increase in competition from entertainment-based apps like TikTok and YouTube.
But even though its number of subscribers has taken a hit, Netflix is not afraid of competition. Apart from HBO Max, the streamer now has the new Discovery-Warner combination to worry about but Reed Hastings, Netflix’s co-CEO, has dismissed all the speculations and deemed the merger as something which is “not as significant” as Disney’s acquisition of Fox. He further added that Netflix’s subscriber growth hasn’t been affected by HBO and Disney.
There is no denying that when streaming platforms like Disney+, Apple TV+, HBO Max, etc launched, they didn’t enjoy the same instantaneous growth as Netflix did. But another fact that can’t be neglected is that despite their slow start, these platforms are now steadily branching out and seriously hampering Netflix’s ability to bring in new subscribers.