The Netflix Crash: Simmer Down

Netflix stock plummeted over the last two days as news broke of its having lost 200,000 subscribers, when the company had projected an increase of 2.5 million new customers. To add insult to injury, they reworked their projections for the next quarter to show an additional subscriber loss of 2 million. “The sky is falling,” everyone is screaming! Not so fast friends and countrypersons.

Netflix has the largest subscriber base of all the streaming platforms and tons of profitability, with more than 221 million subscribers worldwide. Yes, they had a huge head start, and companies like Disney gave Netflix carte blanche to show their old films. Now that Disney has its own streaming service, the company is using its catalog of great films to lure in subscribers and keep them happy when they get there. And then we have some fabulous — I mean fabulous — content coming from some of the other streaming platforms, including Apple (can we talk about “Pachinko,” which I reviewed just last week and consider to be one of the finest series ever released) and HBO, with too many hit series to mention.

Does Netflix need to make some changes? Yes, and they are doing so. They will be offering a commercial-based subscription for less money. Keep in mind, they raised their prices a few months ago, and that is one of the things that makes people evaluate rate of return and decide to walk away. They need to continue to build talent, like they did with Shonda Rhimes, who has come back tenfold with her shows “Bridgerton” and “Inventing Anna.” Truth be told, a streaming service needs just one hook, one series that is talked about so much that a great number of people will subscribe just to watch it. That’s when a company needs to build loyalty by spending time reaching out to subscribers to suggest other shows that will keep them around month after month.

Brand loyalty in this new world in which we live is a moving target. Keeping track of what your competition is doing and making sure you are doing more is critical.

But I think there is a bigger picture here. I believe there is change afoot in the industry and that the film distribution companies are going to join companies such as Polaroid and Blockbuster in struggling against obsolescence.

Streaming companies have the dollars and the hands-off attitude that affords talent the free rein they’ve always dreamed of having to create, without restraint, the films and series they’ve wanted to make. And so the need for a distributor to place films in the marketplace will continue to fade away until its eventual death. Anything that gets rid of a middleman is something I’m all for, unless, of course, it cuts out women-owned businesses, which I will forever continue to champion.

This cosmic shift will be good for women in film. I just gave an industry-update presentation to Women in Film members last night, and what I told them was that I thought they should start to connect to the streaming services that best mirror their own brand and the brand they aspire to be. Connect to them on LinkedIn. Participate in the social media conversations touting their films and series, and pay attention to who at the company would be a decision-maker, should they have the opportunity to pitch to them.

In other words, put some eggs in the baskets of the streaming platforms, because some of the studios who will enter the subscription model will never be able to gain a foothold in the streaming-saturated market, will be eaten up by those platforms over the coming years. And frankly, considering the way they’ve historically treated women, along with their sluggish approach to improving the representation of women in film, that is fine with me. The Center for the Study of Women in Television & Film recently released mind-boggling data: In 2021, only 34% of speaking parts in film were women, down from 36% in 2020. This is interesting, considering some the strongest performing films, both in viewership and awards, feature women protagonists.

Gender has no place in film. Talent does. The streaming platforms do not have the same extensive history of male-dominance as the film industry. So I, for one, welcome this new paradigm shift that might better serve me and my peeps.

-Christine Merser, Managing Partner, Blue Shoe Content