Anthropic Reportedly Taps Wilson Sonsini as It Prepares for a Potential 2026 IPO 
Trump Administration to Secure Equity Stake in Pat Gelsinger’s XLight Startup 
Firelight Launches as First XRP Staking Platform on Flare, Introduces DeFi Cover Feature 
Nexperia Urges China Division to Resume Chip Production as Supply Risks Mount 
Sam Altman Reportedly Explored Funding for Rocket Venture in Potential Challenge to SpaceX 
Senate Sets December 8 Vote on Trump’s NASA Nominee Jared Isaacman 
YouTube Agrees to Follow Australia’s New Under-16 Social Media Ban 
Coupang Apologizes After Massive Data Breach Affecting 33.7 Million Users 
Baidu Cuts Jobs as AI Competition and Ad Revenue Slump Intensify 
OpenAI Moves to Acquire Neptune as It Expands AI Training Capabilities 
Intel Boosts Malaysia Operations with Additional RM860 Million Investment 
Microchip Technology Boosts Q3 Outlook on Strong Bookings Momentum 
Banks Consider $38 Billion Funding Boost for Oracle, Vantage, and OpenAI Expansion 
Norway’s Wealth Fund Backs Shareholder Push for Microsoft Human-Rights Risk Report 
Apple Leads Singles’ Day Smartphone Sales as iPhone 17 Demand Surges 
Taiwan Opposition Criticizes Plan to Block Chinese App Rednote Over Security Concerns 
Netflix executives have previously not been so open about introducing a cheaper subscription tier supported with advertisements. But that seems to be changing after the company confirmed it lost subscribers over the last quarter.
The company released a letter to its shareholders for the first quarter of 2022 and confirmed that Netflix lost 200,000 subscribers in the last three months. This is the first time the streaming giant reported a membership loss for a quarter over the last 10 years. And the streaming giant said in its forecast that it expects to lose 2 million paid memberships in the second quarter of the year. Netflix shares plunged by more than 25 percent after trading hours on Tuesday.
Following this series of bad news, Netflix seemed to have softened its stance on ad-supported lower-cost membership tiers. “Those who have followed Netflix know that I have been against the complexity of advertising and a big fan of the simplicity of subscription,” co-CEO Reed Hastings said (via CNBC) in a pre-recorded earnings call on Tuesday. “But as much as I am a fan of that, I am a bigger fan of consumer choice, and allowing consumers who would like to have a lower price and are advertising-tolerant to get what they want makes a lot of sense.”
Just last month, Netflix CFO Spencer Neumann said that an ad-supported tier was not part of the company’s plans. The comment came a few days after Disney+ announced it will offer a membership plan with ads at a lower cost sometime in 2022.
In the same financial report, Netflix said it is seeing slowing revenue growth and identified several factors that caused it. For one, the company says there are 100 million “additional households” that access its services through account sharing. Netflix added that this is one of the reasons “it’s harder to grow membership in many markets.”
It is worth noting that Netflix has heavily hinted at cracking down on password sharing by introducing an Extra Member Fee that has been in testing for a month now in Chile, Costa Rica, and Peru. It is unknown if this experiment will be extended to other regions. But considering Netflix has now identified account sharing as one of the main reasons for its slow revenue growth and subscriber loss, it might be just a matter of time before the added fee becomes official worldwide.
Photo by Thibault Penin on Unsplash
