Netflix is considering introducing a low-cost subscription supported by advertising. The changes are designed to help Netflix regain momentum lost over the past year. Pandemic-driven lockdowns that drove binge-watching have been lifted. Apple and Disney have begun to chip away at its audience with their own streaming services.
Netflix’s customer base fell by 200,000 subscribers during the January-March quarter. The drop stemmed in part from Netflix’s decision to withdraw from Russia. Netflix projected a loss of another 2 million subscribers in the current April-June quarter. It is the first contraction since it became available throughout most of the world six years ago.
Netflix shares plunged by more than 25% in extended trading after the video-streaming company revealed its disappointing performance. The erosion, coming off a year of progressively slower growth, has rattled Netflix investors. If the stock drop extends into Wednesday’s regular trading session, Netflix shares will have lost more than half their value this year.
Netflix says about 30 million people in the US and Canada are watching its video-streaming service for free. The company estimates that about 100 million households around the world are already using the service. “We’ve just got to get paid at some degree for them,” Netflix CEO Reed Hastings says.
