The Real Reason Netflix Subscriber Growth is Slowing

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Earlier this week Netflix reported second quarter earnings and shares  tumbled 15% in after hours trading after the company missed targets on subscriber growth. During Q2 Netflix added just 1.7 million members, short of the company’s own forecast of 2.5 million new customers and significantly below the 3.3 million members that Netflix added in the same period of last year. Netflix has 83 million total subscribers.

The company says the slowing growth is because Netflix raised the prices of its services by $1. Could one dollar have this much impact? We are not convinced.

Netflix, argues Rob Toledo at Exstreamist, “can’t see the forest through the trees.” He believes people are leaving not over a dollar, but over a shrinking content library.

He makes a valid point: the content in the US Netflix library has decreased 40% since 2012. The streaming service has in recent years banked heavily on original content, but it seems to have come at the expense of other shows.

Netflix Down in After Hours Trading After Missing Subscriber Targets

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