- Sweeping Vietnam internet law comes into force
- Pope kicks off Christmas under shadow of war
- Catholics hold muted Christmas mass in Indonesia's Sharia stronghold
- Japan's top diplomat in China to address 'challenges'
- Thousands attend Christmas charity dinner in Buenos Aires
- Demand for Japanese content booms post 'Shogun'
- As India's Bollywood shifts, stars and snappers click
- Mystery drones won't interfere with Santa's work: US tracker
- Djokovic eyes more Slam glory as Swiatek returns under doping cloud
- Australia's in-form Head confirmed fit for Boxing Day Test
- Brazilian midfielder Oscar returns to Sao Paulo
- 'Wemby' and 'Ant-Man' to make NBA Christmas debuts
- US agency focused on foreign disinformation shuts down
- On Christmas Eve, Pope Francis launches holy Jubilee year
- 'Like a dream': AFP photographer's return to Syria
- Chiefs seek top seed in holiday test for playoff-bound NFL teams
- Panamanians protest 'public enemy' Trump's canal threat
- Cyclone death toll in Mayotte rises to 39
- Ecuador vice president says Noboa seeking her 'banishment'
- Leicester boss Van Nistelrooy aware of 'bigger picture' as Liverpool await
- Syria authorities say armed groups have agreed to disband
- Maresca expects Man City to be in title hunt as he downplays Chelsea's chancs
- Man Utd boss Amorim vows to stay on course despite Rashford row
- South Africa opt for all-pace attack against Pakistan
- Guardiola adamant Man City slump not all about Haaland
- Global stocks mostly higher in thin pre-Christmas trade
- Bethlehem marks sombre Christmas under shadow of war
- NASA probe makes closest ever pass by the Sun
- 11 killed in blast at Turkey explosives plant
- Indonesia considers parole for ex-terror chiefs: official
- Global stocks mostly rise in thin pre-Christmas trade
- Postecoglou says Spurs 'need to reinforce' in transfer window
- Le Pen says days of new French govt numbered
- Global stocks mostly rise after US tech rally
- Villa boss Emery set for 'very difficult' clash with Newcastle
- Investors swoop in to save German flying taxi startup
- How Finnish youth learn to spot disinformation
- South Korean opposition postpones decision to impeach acting president
- 12 killed in blast at Turkey explosives plant
- Panama leaders past and present reject Trump's threat of Canal takeover
- Hong Kong police issue fresh bounties for activists overseas
- Saving the mysterious African manatee at Cameroon hotspot
- India consider second spinner for Boxing Day Test
- London wall illuminates Covid's enduring pain at Christmas
- Poyet appointed manager at South Korea's Jeonbuk
- South Korea's opposition vows to impeach acting president
- The tsunami detection buoys safeguarding lives in Thailand
- Teen Konstas to open for Australia in Boxing Day India Test
- Asian stocks mostly up after US tech rally
- US panel could not reach consensus on US-Japan steel deal: Nippon
End of an era as Netflix faces stagnation challenges
Having lost subscribers for the first time in more than a decade, Netflix faces the new challenge of stagnation from a position of strength.
A drop of just 200,000 users -- less than 0.1 percent of its total customer base -- was enough to send Wall Street panicking, with shares plunging more than 30 percent on Wednesday.
The loss of subscribers and the company's various plans to revive business "change the historically simple story" of Netflix's solid success, said Wells Fargo analysts, who cut its price target in half.
"The new outlook is clear as mud," they said.
If the Q1 loss of subscribers might seem a blip at first blush, Netflix is signaling otherwise: The company anticipates a much larger drop in its second quarter -- of around two million net subscribers.
"I'm not sure that's a turning point" for Netflix, said Scott Zari of S&P Global Ratings.
"But I think it is indicative of maybe a new phase of slower growth," he said.
Bank of America analysts said in a note that Netflix "made it clear that we can expect very low subscriber growth in '22 and '23 with no margin expansion."
The shift was felt even in the tone of the company's results presentation on Tuesday evening.
The affair focused less on the streamer's mega hits such as "Bridgerton" and "Ozark" and more on combating the 100 million households who watch Netflix for free thanks to shared passwords.
"When we were growing fast, it wasn't the high priority to work on," co-founder Reed Hastings admitted. "And now we're working super hard on it."
Chief operating officer Gregory Peters said Netflix wasn't trying to shut down sharing, "but we're going to ask you to pay a bit more to be able to share."
According to Zari, "future growth will be dependent on how can they monetize those households."
- Advertising is coming -
To attract viewers, Netflix is preparing cheaper subscriptions with advertising -- which it expects to roll out in the next couple years.
The Los Gatos, California-based company has long defended its no-ads model, which set it apart from competitors such as Disney+, HBO Max and Apple.
For Pivotal analyst Jeff Wlodarczak, streaming "appears nearly fully penetrated globally post-Covid," and the companies now must set their sights on converting pirates into subscribers, gaining greater market share from each other and driving up prices."
Increasing prices won't help Netflix in the short term, though it raised its fees in January to the extent that it is now the most expensive among the major streamers.
"I think they'll have to adjust their business," said Paul Hardart, a professor at New York University, including "on the cost side, investing in content."
For University of Richmond professor Joel Mier, Netflix's price increases and axing of password sharing are "peripheral but meaningful" short-term solutions, while its long-term strategy remains "investing in local-content creation and establishing its gaming presence."
With 221 million subscribers, "Netflix is by far the market leader in the streaming space," Zari said.
"They're very far ahead, particularly in the global marketplace," said Hardart. "I think it will give them a lot of advantages."
The problems Netflix faces are "not good news" for the company, he emphasized.
But as the global leader, whatever Netflix goes through, the other streamers are also likely to face eventually.
It's "probably worse news for the other services that are starting to try to build themselves," he said.
O.M.Souza--AMWN