UNITED KINGDOM: The cost-of-living problem will take its toll on Netflix’s UK member base in 2023, and it will take time for the streaming giant’s new, less expensive, ad-supported option to gain traction with customers.
The largest streaming service in the world is predicted to have lost 500,000 UK customers in 2022 and another 200,000 this year as a result of people becoming more frugal with their spending.
According to research firm Ampere Analysis, the company, which reported its first global subscriber declines in a decade earlier this year, has since reduced staff and tightened control over its $17 billion (£14 billion) annual content budget. This year, the company’s UK user base will have dropped from 14.2 million to 13.7 million.
The most popular streaming service in the UK, Netflix, is expected to be the only one to lose customers in 2022. As consumers approached “peak Netflix,” the firm added 800,000 users in 2021, the fewest since it began operations in the UK in 2012.
With the first season of Lord of the Rings spin-off The Rings of Power costing an eye-watering $465 million (£336 million), Amazon’s Prime Video, a competitor, saw its UK subscriber base increase from slightly over 12 million to 12.3 million accounts in 2022.
Disney+, the newest streaming behemoth launched in the UK in early 2020, will claim market-leading growth of 1.4 million members to bring its UK base to 6 million this year, making it the only primary service to sustain considerable momentum.
The UK economy is in a terrible position, with inflation at a four-decade high of almost 11% and a worse outlook than most big global economies, so the subscriber recovery will take much longer.
In 2023, it is anticipated that Prime Video will lose around 100,000 subscribers, and Netflix will lose about 200,000 UK customers. Only Disney+, home to well-known brands like Marvel, Pixar, and Disney, is anticipated to continue to experience rapid growth this year, gaining an estimated 1.4 million new members.
To jumpstart its stagnant global growth, Netflix debuted its ad-supported subscription service in the UK and roughly a dozen other territories in November for £4.99 per month, £2 less than its cheapest choice.
In the past, Netflix members have remained loyal despite price rises, but since the cost of bundles has risen significantly, quitting the service is now happening much more frequently, even if it is cheaper than traditional pay-TV subscriptions.
For the second time in less than 18 months, Netflix raised subscription pricing in the UK in March.
Also Read: Netflix’s Share Rises by 14% As It Reverses Its Subscriber Slump
