Analysis: The sky is falling for Netflix

Netflix’s (Netflix ended 2021 with 221.8 million subscribers. That’s significantly more than others in the streaming marketplace, including Disney, one of its closest competitors. Disney had 118.1 million subscribers as of October, and it grew subscriptions 60% between October 2020 and October 2021. During that same period, Netflix grew just 9%. Disney hasn’t yet reported its financial results for the last three months of 2021. But Netflix’s growth slowed even further in the fourth quarter to just 8%. (And For some consumers, price increases — even small ones — are a lot to ask considering that so many competitors are at Netflix’s gates. Rivals like Disney+, Peacock and HBO Max from CNN parent’s company, WarnerMedia, are also vying for a share of consumer’s streaming budget. A dollar here or there matters to consumer’s wallets.Netflix admitted as much on Thursday saying that competition is “affecting our marginal growth some.”On the post-earnings call on Thursday, Reed Hastings, Netflix’s co-CEO, also explained that there were many reasons for the company’s tepid financial outlook, which included “ongoing Covid overhang” and economic hardships.But he also conveyed confidence in the future of streaming, as well as Netflix’s large market size and steady execution. “For now, we’re staying calm,” he said.But will Hastings still be calm at the end of 2022? Will investors?”The intensity of competition is going to pick up in 2022,” Nathanson said. “You have sports being rolled out on streaming. You have Lord of the Rings coming from Amazon (AMZN). You’ve got Discovery and HBO Max merging, so more content there. And Disney’s backend content slate is coming.”Nathanson added, “I think 2022 is going to be one of concern about growth and competition for Netflix.”