Netflix Makes Major Changes to Its Plans

Streaming company Netflix is changing up its approach. The company, known for its subscription model without ads, is now diving into live sports, video games, and ad-supported content. This move comes as rivals like Disney+, Hulu, and Peacock ramp up their original content offerings.

Last year, Netflix tried curbing password sharing by encouraging users to set up individual accounts. This risky move paid off, helping Netflix announce a record number of subscribers in January. The company’s stock has risen 31% this year so far, “outperforming its competitors.”

However, the boost Netflix has seen from its password strategy might be waning. According to Ross Benes, a senior analyst from eMarketer, “Netflix’s lead in the streaming wars is well-established. But it is unlikely to repeat the huge subscriber additions it witnessed last quarter as password-sharing boosts recede.”

Analysts are eager to see if Netflix’s new direction will pay off when the company announces its first-quarter results later today.

The streaming giant’s strategy became evident when Netflix, despite leading in Oscar nominations, only secured one win for a live-action short film. It seems the company may be stepping away from developing these big-budget shows and films that typically win those awards, which is something it has been known for.

Recently, Netflix has shown interest in licensing more content from other studios. Popular shows like “Seinfeld” and “Sex and the City” are attracting viewers again after appearing on Netflix. The company is also stepping into live sports, securing a 10-year deal to air “WWE Raw,” valued at over $5 billion.

Moreover, Netflix is making a splash in the video game space by collaborating with “Grand Theft Auto,” a popular gaming franchise. This venture into gaming proved successful, according to Netflix co-CEO Greg Peters. “We’re stoked by the performance of GTA,” he said. “We were in the top mobile game downloads for several weeks, which shows it was not only big for us, but big numbers for mobile gaming in general.”

The company’s newer, ad-supported subscription tier is another area of growth. Priced at $6.99 per month in the U.S., this tier has seen rapid growth since its introduction in late 2022, with over 23 million users reported in January.

Netflix’s focus on diversifying its content and revenue streams reflects a broader effort to adapt to a changing streaming landscape. As the company ventures into new territories like live sports, video games, and advertising-supported content, its first-quarter results will shed light on the success of this strategy.