Netflix Adds 13 Million New Subscribers, Take Note Of The Highest Profits Despite Plans To Increase Prices

Netflix recorded an increase of 13 million new subscribers (photo: dock. pexels)

JAKARTA - For those of us who still use a Netflix account belonging to friends or relatives, strict regulations regarding password sharing may be a serious problem. However, for Netflix itself, this move has finally paid off, with the addition of 13 million new subscribers by the end of 2023.

This number brings Netflix's total subscribers to more than 260 million, which confirms it as the world's most popular streaming service.

Despite setting record gains, Netflix announced plans to raise prices higher. "The summary of his statement may be,'returning to business as usual'," said Greg Peters, co-CEO Netflix.

Netflix's latest financial report, covering three months until December 2023, shows annual subscriber growth of 12.8 percent. This is the fastest growth since 2020 and continues the upward trend that began the previous year after shaky 2022.

Netflix now maintains its top position as the world's most popular streaming service, ahead of Amazon Prime Video which has 220 million subscribers worldwide.

In the fourth quarter of 2023, Netflix reported net income of US$937.8 million (Rp 14.7 trillion), or US$2.11 per share. For comparison, in the fourth quarter of 2022, they reported net income of US$55.3 million (Rp 868.8, billion), or 12 cents per share.

Although many new subscribers selected Netflix's lowest subscriptions including ads, the company noted that premium subscriptions, including streaming HD and additional members, are now costing $33 (Rp 361 thousand).

Netflix recently raised the price of basic and premium subscriptions by 1 pound and 2 pounds in a row. Despite its profit of 5.4 billion US dollars (Rp 84.8 trillion) for the year, compared to 4.49 billion US dollars (Rp 70.5 trillion) the previous year, Netflix stated its readiness to re-upgrade prices.

"We mostly delayed price increases as we implemented the share payments. Now that it's done, we can continue our standard approach," said Greg Peters.

Netflix also made a surprising announcement that it will stop its lowest subscription option without advertising in some countries. The company's executives told investors they would start stopping the 11.99 US dollars package in Canada and the UK starting April this year.

Netflix no longer allows new subscribers or re-registered for basic packages, so these changes will only affect existing members. Customers will be forced to choose between paying more expensive subscriptions or receiving ads.

In early 2022, Netflix began to worry investors when it recorded its first customer loss. In the second quarter of 2022, Netflix lost 970.000 subscribers, following a 200.000 loss in the first quarter.

Hit by a sudden loss of subscribers, Netflix began raising prices and enforcing password sharing rules. Millions are barred from lending to anyone outside their homes as the streaming giant strengthens rules in more than 100 countries.

Since March last year, Netflix has switched to a'sharing payment' system, which charges extra fees to households to let additional people use their accounts.

While this move never comes into effect with fines, the discovery threat seems to be enough to reverse Netflix's fortunes. Ben Barringer, technology analyst at Quilter Cheviot, said, "These figures confirm that Netflix ultimately won the streaming war. Traditional TV businesses are unable to keep up, and with the large number of returns to license their catalog to Netflix, their dependence on these streaming giants will only grow."