Reed Hastings, co-CEO of Netflix, thinks linear TV may become extinct within the next ten years.
“Streaming is working everywhere. Everyone is pouring in,” Hastings said Tuesday on the media giant’s second-quarter earnings call. “It’s definitely the end of linear TV over the next five, 10 years.”
The forecast follows the “Stranger Things” creator’s disclosure that during the second quarter, the company lost 970,000 subscribers, falling short of its two million subscriber forecast. The streamer experienced its first decline in over ten years in the first quarter, losing 200,000 subscribers.
Hastings continued, “We’re improving everything we do around marketing, improving the service, the merchandising, and all of that solely pays off.” He added: “But again, we’re talking about losing one million instead of losing two million. So our excitement is tempered by the less bad results.”
In its shareholder letter, Netflix claimed that during the 2021–2022 TV season, it attracted more TV viewers than any other platform, almost matching the combined total of the two most popular broadcast networks, CBS and NBC. In June, Netflix’s percentage of all TV viewing in the US grew to an all-time high of 7.7 percent.
The business claimed that it is concentrating on re-accelerating subscriber and revenue growth in the near future. In collaboration with Microsoft, Netflix will launch a more affordable, ad-supported subscription tier in the first half of 2023.
Additionally, since March, the business has been testing a paid sharing feature called “add an extra member.” in Chile, Costa Rica, and Peru.
Beginning in August, it will also test a feature called “add a home” in Argentina, the Dominican Republic, Honduras, El Salvador, and Guatemala. With this feature, users will be charged an additional monthly fee if they stream through a TV or TV-connected device located outside of the primary household associated with their account for a period of time longer than two weeks.
The business disclosed in April that more than 100 million households, including 30 million in the United States and Canada, shared passwords.
Our objective is to identify a user-friendly paid sharing service that we can launch in 2023 and that we believe will benefit both our customers and our company.
At the end of the second quarter, there were nearly 221 million subscribers to Netflix worldwide. In the third quarter, the company anticipates adding a further million subscribers.
The share price of Netflix has decreased by more than 60% so far this year as of the time of publication.