Enrollments for Netflix (NASDAQ:NFLX) in the United States maintain strong levels despite a slight dip from the all-time high observed in June, subsequent to the implementation of the video-streaming trailblazer’s measures against shared passwords in May, as outlined by insights from research firm Antenna.
Back in 2017, Netflix had conveyed the message “Love is sharing a password” on the platform then known as Twitter. However, the company’s global campaign to curb password-sharing now reveals its strategic approach to diversify revenue sources in a highly competitive and saturated market.
Attracting novel subscribers and upholding the loyalty of existing ones has grown increasingly challenging over the past years, considering the surplus of choices available to consumers, including Walt Disney’s streaming service, Amazon.com’s Amazon Prime Video, Warner Bros Discovery’s Max, and more.
During early trading, Netflix’s shares saw a 1.7% increase. Wall Street had previously expressed concerns that the clampdown on password-sharing might impede subscriber growth. Nevertheless, Netflix’s (NASDAQ:NFLX) decisive action has effectively revitalized its subscriber acquisition rates.
According to Antenna, the number of new gross subscribers for the video-streaming company dropped by 25.7% in July compared to the preceding month, subsequent to a significant surge in signups during June. Despite this, the 2.6 million gross additions in July remained notably higher than the average figure, indicating a sustained level of interest.
In the prior year, Netflix had signaled its intention to restrict account-sharing and had been testing various strategies in select markets. The company’s estimation indicated that over 100 million households had shared their login details with individuals beyond their residences. This led analysts to predict that approximately 50 million users would ultimately transition to individual accounts.
Antenna reported that around 23% of users who registered in July opted for the more affordable ad-supported Netflix plan. This percentage marked the highest since the plan’s introduction in November, reflecting a 4-percentage-point increase from the previous month.
Antenna gathers its streaming data from sources like online purchase receipts and financial transaction records.
Featured Image: Unsplash
