Our dear Netflix is growing up and is reaching greater horizons. Since its origin, Netflix has continually strived to increase its customer base and profits. While still in competition with other companies such as Hulu and Amazon, Netflix appears to have the competitive advantage overall.
Currently Netflix has a total of 93.8 million members and is still growing; an accelerated surge of 5.1 million international subscribers contributed greatly to this membership total. Netflix has commented that it is researching “how best to match content with audiences tastes around the world.” It is evident that by accommodating an expanding to international members has been beneficial, because 44.4 million members are located outside of the United States–that is “more than 47 percent of its total membership.”
Company profits have been projected to reach $165 million in the current quarter, which is a major development from the $28 million projection from their period a year ago. The Netflix profit margin increased 56 percent to $67 million from a 2015 quarter. Profits are systematically increasing as each quarter arrives, and it appears as though they will continue to increase as the year continues on.
The total Netflix shares rose around eight percent for all of 2016, and typically is “volatile on days when the company reports earnings.” In 2015 the shares skyrocketed to an approximation of 135 percent. Reported on Feb. 15, 2017, the Netflix sales were up about 0.32 percent. This consistent increase in stock is making 2017 promising to investors.
There are various companies that provide a similar television service as Netflix and the competition is becoming more intense. As mentioned previously, the main rival companies are Hulu and Amazon. In 2016, the cost for Netflix and Hulu’s basic plans were $7.99/month, and Amazon cost was $8.99/month. The prices are so similar that they do not seem to have much of an effect on the overall user count. Data from Nielsen, states that close to “half of American households with a television had a subscription to some sort of streaming service,” and 89 percent of those household have a subscription to Netflix. Amazon is gradually catching up to Netflix, but for the time being Netflix is the hegemony of the online television service.
As of April 2016, according to Business Insider, Netflix offers 4,563 shows and 2,445 movies. Every few months, the company undergoes an expunction and gets rids of various TV shows and movies. To some users this is a downside of Netflix, however, Netflix adds new content after each ridding of material. It has been said that the company plans to invest more than “$6 billion in content this year.” In addition, the company has announced that 1,000 hours of Netflix original shows and movies will be released throughout this year. Two of the top shows, as cited by Netflix, are the series “Marvel’s Luke Cage” and “The Crown,” both shows are “worldwide hits.” Devoted Netflix users are looking forward to this year and what shows and movies will be added to the service.
As Netflix continues to thrive, co-founder and CEO Reed Hastings said, “think of us as just continuing to iterate on the basic cycle of more content and better product that combines at a great service and great price.” The “basic cycle” that Mr. Hastings is referring to seems to be the ultimate plan behind Netflix’s success.