A rising tide lifts all boats — but in Netflix’s case, that may not be such a good thing.
As more big-name streaming services have hit the scene over the last two years, Netflix’s dominance over the U.S. subscription video on-demand market has taken a big hit, according to new data shared by research firm Antenna.
The key takeaway from Antenna’s data: Netflix accounted for 29% of all paid streaming subscriptions in the U.S. by the end of June — down 19% from Q2 2019. Netflix’s dwindling slice of the American streaming pie comes after the launch of newer services, like Disney+ and NBCU’s Peacock, and have cut into Netflix’s first-mover advantage.
The chart below, courtesy of Antenna’s latest Quarterly Growth Report, gives a better look at the American SVOD market:
Does this mean Netflix is on the verge of going the way of short-lived Quibi? Of course not. But there have been small signs the streaming heavyweight’s stranglehold at home is loosening. For only the second time ever, Netflix recently reported it lost North American customers during the last quarter — 400,000, to be exact during Q2. (The company added 1.5 million subscribers, mostly from Asia, during the quarter.) Overall, Netflix had 73.95 million customers in the U.S. and Canada, with about 65 million of those coming from the States.
And based on Antenna’s data, that came out to about 224 million streaming subscriptions in the U.S. overall — which is a little less than one SVOD service per adult on average. (Note that doesn’t include free ad-supported streaming services like Pluto TV.)
Netflix isn’t the only streaming service that has seen its slice of the pie diminish. Hulu, the other major streamer to hit the market before the latest barrage of new services, has seen its cut go from 26% to 19% during that time.
“If you go back to Q2 2019, Netflix and Hulu controlled nearly 75% of [U.S. streaming] subscriptions, and you fast forward two years to today, and they’re below half,” Brendan Brady, a content strategy analyst with Antenna, told TheWrap. “Obviously, the streaming pie has grown over that time. But the fact that, if you go back to Q2 2019, there were a lot of people out there with the ‘Netflix will replace all television’ thesis. And we’re beginning to see that, no, this is going to be a pretty competitive [streaming] arena.”
Brady added that it’s important to remember this doesn’t mean Netflix and Hulu have lost subscribers over the last two years. Instead, their declining share of the market indicates they were ahead of the curve, and now that other services have joined the fold, Netflix and Hulu were bound to lose some of their control over the market. Hulu’s diminishing slice of the pie is offset, too, by the emergence of Disney+, which now accounts for the third-biggest share of the U.S. market. (Disney has full operational control of Hulu.)
Moving forward, it’ll be worth seeing if Netflix can re-claim some of the U.S. market share its lost over the last two years. As other services gain a foothold, that may be tough to do. But Netflix is certainly trying to reclaim its advantage, with the company looking at new ways to win over customers — including offering Netflix-themed video games to subscribers as part of their monthly plans. For now, though, it’s clear the trail Netflix blazed has led to more competitors following its lead.
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