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Netflix Strikes Back: A Deeper Look at Password Crackdowns and Advertising
After a challenging post-covid phase marked by subscription losses that impacted revenues and its reputation as a consistent generator of growth, Netflix has daringly implemented two significant (if controversial) strategic maneuvers to considerable success, emerging as one of the stand-out performers of 2023. The first initiative put an end to account sharing. Though some observers initially dismissed the announcement as an empty threat or even a misstep, data from occam suggests the initiative is likely accretive to BOTH subscriptions and Average Revenue per Membership (ARM). The second initiative introduced an ad-supported subscription tier. Thus far, the plan has shown to be an effective churn reducer and incremental on-ramp to price sensitive consumers. Below, we reveal how both maneuvers are growing Netflix revenues and expanding its prized subscriber base.