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Four years ago, Netflix was faced with a formidable challenge to its dominance. Competitors including Walt Disney Co. and Warner Bros. Discovery invested billions of dollars to chip away at Netflix’s market share by launching splashy shows on their own streaming services.
For a time, it seemed that Netflix was vulnerable. The company lost subscribers for two straight quarters in 2022 despite gargantuan spending, raising concerns that its growth had plateaued.
But lately the tide has turned. Netflix has managed to maintain its position as the leader in subscription streaming, with 260 million paying customers worldwide, far more than its direct competitors. Netflix added more than 13 million subscribers during the fourth quarter. The Los Gatos, Calif.-based company’s stock has surged roughly 90% during the last year.
As a result, many analysts have made a bold proclamation in recent months. The so-called streaming wars are over, they say. Netflix has won. As evidence, they point to rival studios that are now licensing more of their programs to Netflix, including HBO’s “Six Feet Under” and “Insecure,” after years of holding onto their big action movies and popular shows for their own platforms.
“Their competitors are so desperate to make money, they’re giving this content to Netflix,” said Jeffrey Wlodarczak, chief executive of Pivotal Research Group. “This is what winning is.”
Netflix executives, for their part, sound as confident as ever, even as the company continues to make changes, including a recent shakeup in its film business. There’s much more runway for Netflix to grow, Spencer Neumann, Netflix’s chief financial officer, said at a Morgan Stanley conference in San Francisco on Monday.
“We are just getting started,” Neumann said. “Now we’re small in every measure. Every way we look at it, we’re less than 10% of the view share in every country in which we operate, and that’s a pretty small slice of pie.”
How did Netflix defend its bulwark when there are still multiple streaming services fighting for eyeballs?
The streamer has cracked down on password sharing, offering a cheaper ad-supported plan for cost-conscious viewers. Added restrictions on viewers who were borrowing Netflix accounts got people to buy their own subscriptions, helping the company increase net income to $938 million...