With all the recent news of new streaming services being announced almost daily, it can sometimes slip our minds that Netflix, the original streaming giant, is still around.
However, according to a recent announcement, Netflix has reached more than 150 million subscribers, and in the process, reminded everyone they are still the king of the video streaming services.
Additionally, of the 157 million current subscribers, 151 of them are paying subscribers (which is a pretty big attack on all the memes about people mooching off their friends’ and family members’ Netflix accounts).
Currently, the streaming service boasts 157 million subscribers, of which 96 percent are paying subscribers.
That’s a significant growth compared to their subscribers from 10 years ago—with 10.6 million subscribers in 2009, Netflix has increased their subscriber base by nearly 15 times that number over the last decade.
Much of that growth has been over the last couple of years; five years ago, in 2014, they had a smaller, yet still impressive 50 million subscriber. Then, last year, they increased their subscriber base by nearly 30 percent to 130 million, and this year, by quarter two, they have reached 157 million.
How They Did It
It’s safe to say the company’s decision to pivot from their original platform—a video mailing service—turned out to be a lucrative one.
When Netflix first launched in 1998, it took nearly three years for the company to accrue half-a-million subscribers.
However, since they began offering their streaming service, they have continued to grow their subscribers year after year.
Part of this success can be attributed to the first-mover advantage principle—Netflix was the first company to create the streaming service platform that nearly every media company is currently attempting to roll out.
Additionally, Netflix’s recent commitment to producing original content has allowed them to remain competitive now that the market is becoming saturated.
The Cost of Success
However, while Netflix has been able to stay atop the growing heap of streaming services, it’s not without its price. The company is currently churning out original content one after the other, and it’s not exactly cheap.
According to GlobalData’s Cyrus Mewawalla, Netflix is spending approximately upwards of $15 billion USD on original content.
Part of this is related to recent announcements from other media companies regarding launching their own streaming services—since any content that isn’t a Netflix original could be at risk of being removed from the streaming service, the company needs to keep spending money on originals to ensure people will keep their subscription as more and more streaming services become available.
Speaking of new streaming services coming out, Netflix could be in store for dark times ahead, as they have already lost The Office, Friends, and many of its Disney content to rival streaming services.
The fact that so many rival media companies are attempting to copy Netflix’s formula for success is largely why the company has been so focused on creating their own, original content.
However, it remains to be seen whether Netflix will continue to thrive as the market becomes more competitive.