3 ms·

Worth to note: Not 1M _PAYING_ users (THAT would be interesting news). They lost 1M users who watch Netflix according to an external household survey

readthenotes1 4y ago
1/3 of those million were paying customers tho.
- rickdeckard 4y ago
  Yes, but the bigger picture is much more interesting IMO, as Spain has become a highly-competitive market for VoD, is overly saturated with suppliers and we're in a recession year with rising cost of living. Put into context of the same source's (Kantar) report from end of last year on Spain's VoD consumption, it would be much more interesting to know 1.) how many paying subs each of the providers lost explicitly, and 2.) whether the ~1,3M spanish households which access 6 or more (!!) VoD-services have reduced their "portfolio" Kantar[1]: - By September 2022, the number of households that used at least one video streaming service in Spain reached 66%, 12.4million households. - VoD-enabled households accessed on average 3.3 different video streaming services, with 11% of households accessing 6 or more different VoD services. - 2.7% of Spanish households took out a new Subscription Video on Demand (SVoD) service in the last three months. - 23% of those planning on cancelling at least one SVoD service in the next quarter are doing so to save money, the #1 reason. [1] https://www.kantar.com/inspiration/technology/newly-launched-service-shows-spanish-streaming-market-to-be-hyper-competitive https://www.kantar.com/inspiration/technology/newly-launched...
  - kmac_ 4y ago
    And that opens another risk for Netflix. Paying users that canceled will be more eager to check the competition, and migrated user is harder to regain. Anyway, the catalogue is so fragmented that cyclic migration makes sense.
    - rickdeckard 4y ago
      The paying user in Spain is already among those who use on average 3.3 VoD-services. He already thoroughly checked the competition, he's merely deciding to cut his cost. So in the end the issue is the competitiveness of the content at the given price for this market.
vidarh 4y ago
But note that it correlates to a loss of paying users too. "Only" 2/3 of those users were sharing a password. There's another danger here for them, and that is cultural. Currently e.g. my girlfriend users my password. It means we both watch the same things, and talk about things that are on Netflix, and that serves as a reason for me to keep watching Netflix too. A whole lot of my Netflix watching is down to her. If she were to, say, spend her time on Disney Plus instead and talk to me about series there, I might end up spending more of my time on Disney Plus, and value my Netflix subscription accordingly lower. Do that to enough users and you'll start losing them. As long as people keep watching Netflix they have a chance to convert them to paying users, but even if that fails, at the very least they have a chance to prevent those people from converting their paying customers to users of other services. If I was Netflix I'd think long and hard about less invasive means of doing this, such as e.g. putting restrictions on additional household that might nudge them towards paying (e.g. limiting number of profiles so people need to share profiles; putting ads for Netflix in front of shows on "secondary" locations etc.) without outright pushing people off the service.
- rickdeckard 4y ago
  > As long as people keep watching Netflix they have a chance to convert them to paying users. I'm not rejecting this (and I'm also not a fan of Netflix's practice here), but when REALLY thinking about it, how would that work practically without devaluing your product/service? If people are repeatedly sneaking into your cinema and you don't crack down on them, but let them watch every time because one day they may buy a ticket, what's a path to conversion here...? The only values provided are the content itself and the quality of service. NOT restricting access to the content but making it less convenient for everyone will just devalue your service...
  - vidarh 4y ago
    Hence why my last paragraph contained ways of putting restrictions in place that'd make it less practical/desirable to keep sharing. (Here's one more suggestion: Add premium content, and let anyone buy from any profile... Now you have a strong incentive not to share with people you can't trust to not buy stuff on your account... I'd never share my Amazon Prime Video access for that reason). In terms of conversion avenue, consider e.g. kids moving out of the house. My son has his own Netflix profile. For now there's no incentive for him to get his own, and having him get his own would be impractical because he most often wants to watch it on my TV. But once he has a family of his own running into a profile limit would be an incentive to get his own subscription eventually. A lot of people are in situations where they initially legitimately are in the same household, then move out for all kinds of reasons (flat shares, kids moving out, breakups), might not want the hassle of switching profiles right away, but eventually want more flexibility (more profiles), or privacy. (Incidentally, a feature they really need is a "convert this profile to a separate subscription"; that goes for a lot of services that are not at all geared for a situation of kids growing up and wanting to untangle their online lives from that of their parents) A lot of this problem would also just go away if they priced based on a combination of simultaneous streams and number of profiles and stopped worrying about where they are. E.g. there's never any reason for more than 5 simultaneous streams from my Netflix subscription. But if I had to pay per simultaneous stream I'd probably only want to pay for 3.

readthenotes1 4y ago

1/3 of those million were paying customers tho.

rickdeckard 4y ago
Yes, but the bigger picture is much more interesting IMO, as Spain has become a highly-competitive market for VoD, is overly saturated with suppliers and we're in a recession year with rising cost of living. Put into context of the same source's (Kantar) report from end of last year on Spain's VoD consumption, it would be much more interesting to know 1.) how many paying subs each of the providers lost explicitly, and 2.) whether the ~1,3M spanish households which access 6 or more (!!) VoD-services have reduced their "portfolio" Kantar[1]: - By September 2022, the number of households that used at least one video streaming service in Spain reached 66%, 12.4million households. - VoD-enabled households accessed on average 3.3 different video streaming services, with 11% of households accessing 6 or more different VoD services. - 2.7% of Spanish households took out a new Subscription Video on Demand (SVoD) service in the last three months. - 23% of those planning on cancelling at least one SVoD service in the next quarter are doing so to save money, the #1 reason. [1] https://www.kantar.com/inspiration/technology/newly-launched-service-shows-spanish-streaming-market-to-be-hyper-competitive https://www.kantar.com/inspiration/technology/newly-launched...
- kmac_ 4y ago
  And that opens another risk for Netflix. Paying users that canceled will be more eager to check the competition, and migrated user is harder to regain. Anyway, the catalogue is so fragmented that cyclic migration makes sense.
  - rickdeckard 4y ago
    The paying user in Spain is already among those who use on average 3.3 VoD-services. He already thoroughly checked the competition, he's merely deciding to cut his cost. So in the end the issue is the competitiveness of the content at the given price for this market.

vidarh 4y ago

But note that it correlates to a loss of paying users too. "Only" 2/3 of those users were sharing a password. There's another danger here for them, and that is cultural. Currently e.g. my girlfriend users my password. It means we both watch the same things, and talk about things that are on Netflix, and that serves as a reason for me to keep watching Netflix too. A whole lot of my Netflix watching is down to her. If she were to, say, spend her time on Disney Plus instead and talk to me about series there, I might end up spending more of my time on Disney Plus, and value my Netflix subscription accordingly lower. Do that to enough users and you'll start losing them. As long as people keep watching Netflix they have a chance to convert them to paying users, but even if that fails, at the very least they have a chance to prevent those people from converting their paying customers to users of other services. If I was Netflix I'd think long and hard about less invasive means of doing this, such as e.g. putting restrictions on additional household that might nudge them towards paying (e.g. limiting number of profiles so people need to share profiles; putting ads for Netflix in front of shows on "secondary" locations etc.) without outright pushing people off the service.

rickdeckard 4y ago
> As long as people keep watching Netflix they have a chance to convert them to paying users. I'm not rejecting this (and I'm also not a fan of Netflix's practice here), but when REALLY thinking about it, how would that work practically without devaluing your product/service? If people are repeatedly sneaking into your cinema and you don't crack down on them, but let them watch every time because one day they may buy a ticket, what's a path to conversion here...? The only values provided are the content itself and the quality of service. NOT restricting access to the content but making it less convenient for everyone will just devalue your service...
- vidarh 4y ago
  Hence why my last paragraph contained ways of putting restrictions in place that'd make it less practical/desirable to keep sharing. (Here's one more suggestion: Add premium content, and let anyone buy from any profile... Now you have a strong incentive not to share with people you can't trust to not buy stuff on your account... I'd never share my Amazon Prime Video access for that reason). In terms of conversion avenue, consider e.g. kids moving out of the house. My son has his own Netflix profile. For now there's no incentive for him to get his own, and having him get his own would be impractical because he most often wants to watch it on my TV. But once he has a family of his own running into a profile limit would be an incentive to get his own subscription eventually. A lot of people are in situations where they initially legitimately are in the same household, then move out for all kinds of reasons (flat shares, kids moving out, breakups), might not want the hassle of switching profiles right away, but eventually want more flexibility (more profiles), or privacy. (Incidentally, a feature they really need is a "convert this profile to a separate subscription"; that goes for a lot of services that are not at all geared for a situation of kids growing up and wanting to untangle their online lives from that of their parents) A lot of this problem would also just go away if they priced based on a combination of simultaneous streams and number of profiles and stopped worrying about where they are. E.g. there's never any reason for more than 5 simultaneous streams from my Netflix subscription. But if I had to pay per simultaneous stream I'd probably only want to pay for 3.