The company's pivot to an ad-tier is actually a massive opportunity. The Average Revenue Per User (ARPU) on ad-supported plans is often higher than on premium plans because advertisers pay for the eyeballs. By capturing the password borrowers and converting them into low-revenue (but high-margin) ad viewers, Netflix can actually grow its revenue without growing its subscriber count. Netflix is not going out of business. It is too big, too global, and too embedded in the culture to disappear. However, the "free fall" metaphor captures the sentiment accurately: the altitude is dropping fast.
First, the company finally admitted that password-sharing (estimated to affect over 100 million non-paying households) is a problem. After years of famously tweeting that "Love is sharing a password," Netflix is now charging extra for "sub accounts" in Latin America and Europe, with a global rollout imminent. netflix free fall
These moves are financially necessary, but they represent an identity crisis. Netflix is no longer the cool, disruptive tech platform; it is a utility provider trying to monetize every single screen in the house. Here is the bull case for Netflix: They have a moat. The company's pivot to an ad-tier is actually
