Netflix and the Decline

 

    Recently I was made aware of a rumor involving Netflix that I never would have thought to be true, Netflix getting rid of one of the few things that made them unique, having NO ads. When I heard this news I immediately jumped onto the web and did a few google searches. I came across a Forbes article titled "Does Acquiring Roku Make Sense for Netflix?" Now this was the first that I had heard of any partnerships, so naturally I had to make sure they weren't planning any other major changes to my favorite streaming platform.

    Forbes starts off by informing us that there are major rumors that Netflix has been considering a move to acquire OTT platform Roku in order to try and implement a new ad-supported platform to recapture the attention of current and new subscribers. Netflix has been experiencing its first-ever major subscriber decline, with over 200,000 reported alone this year and they are expecting to pass a decline of upwards of 2 million by the end of 2022. With subscribers declining quickly it comes to no surprise that their stock is also not doing so hot, prices are down by more than 67%. Netflix has also been put into a bad situation and are now enforcing budget cuts that are affecting major productions. By joining forces with Roku, Netflix will have a way to test drive a new ad-supported model for content while simultaneously exposing Netflix coverage to a new and wider audience.

    You would think that Netflix's value proposition would include something about how they are ad free and how that puts them apart from other streaming platforms, but it is actually a lot more simple, and doesn't seem to be unique to Netflix. "Watch on demand entertainment where and whenever you want it." This to me describes almost every major streaming platform out there, Over the years other platforms became even more seemingly similar and there were a lot less features that were unique to Netflix and Netflix alone.

    If you've been a follower of Netflix for awhile now, then you'll notice that over the years the quality of content seems to have been declining, there used to be a lot more choices on what to watch and they weren't trying as hard to make sure you watch every original that they come up with. From a consumer point of view, it just hasn't been worth $14.99 a month for HD streaming. Netflix has noticed that subscribers are slowly switching to other platforms and they are trying to combat this recent issue.

    Netflix is attempting to challenge the issue of viewers losing interest while simultaneously trying to fix the stock market prices. By attaining Roku, Netflix will definitely be able to bring in more revenue once they start implementing the new ad-supported platform. I think advertisements will fix the budget cut issue and allow Netflix to once again have many different major film productions. Even if there are ads within the new Netflix platform, because there are more resources available to use for film-making,  viewers will eventually flock back to watch the newest originals. If I could give advice to the brand managers I would tell them that instead of expending all available funds to new projects, that they should instead save a little for buying the rights to existing movies and shows that already have an obsessed fan base. It's harder to interest a new group of people rather than taking advantage of what you already know people like. Although viewers do not like to watch advertisements, I believe that this new cross platform will bring Netflix back to the top of major streaming platforms.