With energy prices shooting up, that scanned server cost is more significant now than it used to be, and per-user bandwidth costs don't drop forever due to economies of scale, so there may be more cost efficient promotion methods than 700,000 non-paying users.
There was a study a while back (can't find it ATM, I'll have another look later) that suggested those using other people's accounts were more likely to be heavy users in terms of bandwidth than average, so perhaps this sort of thing has been factored in to the plan.
Having said that, I can't imagine they expected 300k dropping their account now they can no longer share it. Perhaps there are a lot of friend groups clubbing together to share the cost of subscription services like Netflix.
Energy prices in Europe are dropping significantly. Spain's pricing is down to 2021 levels again last month. No idea where they host their data in Europe but it's much the same in other European countries.
https://www.statista.com/statistics/1267552/spain-monthly-wh...
Arguably that $39 offers a lot more value by giving you access to valuable statistics than the $20 that gives you the opportunity to waste some time staring at the tele. And I'm not saying there's no value to entertainment, but there's plenty of more fulfilling things to do when it comes to entertainment.
Bandwidth isn't an infinite resource. It effectively is up to a certain scale and with a few caveats (the costs are not consistent globally) but I'm sure Netflix is beyond the scale where it can be assumed to be and at that point they will be bidding against other big users for peering priority.
With a dedicate server I have some stuff on I can upgrade to 10gbit unmetered for a lot less than 10x the cost the current 1gbit unmetered link (in my case neither dedicated, but 1-shared-to-10-shared will likely scale in cost similarly to 1-dedicated-to-10-dedicated). With another where I have a total bandwidth cap not a speed cap I could likely extend that cap relatively cheaply. At the scales required by a small company, even one running SaaS services, the same is usually true. But at Netflix's scale a small percent increase in any particular locality is still a huge amount of extra to ask for, and it might not really be available (it could be allowed to eat into slack for a short time, this is one of the reasons why networks are provisioned for more than 100% of expected use, but if the extra is needed permanently then infrastructure upgrades may be needed). They can get around lack of cheap bandwidth by instead temporarily increasing compression rates (this will in fact happen automatically, as dropping overall bit-rate is supported to deal with congestion at the level of a user's connection and that will kick in due to congestion elsewhere too) but this will be easily detectable by some users (particularly those with huge screens and great eyesight) who will compare the quality with other streaming content providers and talk about the difference which may affect future sales.
> on top of this their caching strategy becomes even more effective
Caching in terms of keeping data geographically spread will reduce international bandwidth needs, and ISP-level caching through their local boxes will help considerably again (and get more effective as more users join from the same ISP), but there will always be an amount of traffic that needs to travel costly routes (the ISP level caches will only be large enough to support the best caching candidates, like new high-profile shows, a small proportion of the whole catalogue, and many ISPs do not have that facility at all).
> ““Not only are we placing content on all of these servers around the world, but we are pre-placing them based on what is popular. Because we predict what is popular, we’re able to put it as close as possible under the correct server,” Haspilaire says. “This pre-placement of our films and shows allows us, based on prime time viewing hours, to store 100 percent of our catalog locally."
And they have 17,000 of these boxes. Extra users in these areas will have essentially zero marginal cost. And outside of that, I don't believe the bandwidth market we see - in terms of upgrading our small servers - has any resemblance to the deals they can do.
They still expect more paying customers from this step.
> Last week Netflix missed expectations for new subscribers in the first quarter, but the company said that the password-policing plan and a cheaper streaming version with ads will accelerate growth in the second half of 2023.
They’ve ran test in a couple of countries. Maybe an initial drop in subscribers followed by an increase is in line with their expectations.
I wonder how much this affects the public not talking about the shows and this leading to less engagement. And thus snowballing into even less users, as there is less people to promote shows etc.
That may very well be. But now, their engagement metric on hours viewed [1] is going to drop like a brick and the analysts who started tracking that for the past several quarters will be scratching their head.
But 1 User is (probably) a Premium user. If you remove 3 users, the Premium user could downgrade to Normal. Personally i share with 3. The 3 watch from time to time Netflix, they will not buy an account, only 1 oder 2 Month a year.
If these 3 go, i can downgrade my package to 13 Euro (in Germany) and i will only order it 3 - 4 Month a year. Currently i pay every month 18 Euro.
The time changes, Netflix is not the only player on the market, we can choose now from many.
My brother pay for a "multi-device" account. When they introduce this and the family get cut off he will most likely unsubscribe in time or downgrade to a personal account.
They are probably going back to torrenting and similar.
When disney was slow to rollout in some countries my friends did not want to wait for Mandalorian to drop with Disney plus over there in Europe. They just downloaded it for free and did not even need to sign up for disney when it came one year later.
If the streaming companies start to provide subpar and cumbersome service and charge hundreds of dollars for it per year I can see people going back to proven and free ways that were very popular 15-20 years ago
