Twenty years after it was founded, Netflix ended the first half of 2017 with just under a hundred million paid subscribers, adding 4.68 million in the second quarter to take its total to 99.04 million. That exceeded its own projections, with Netflix attributing it to largely to its massive investment in production, although much of the gain was from international growth, which has yet to turn a profit.
Netflix prefers to highlight total members, which passed over 100 million, with the majority now outside the United States.
In terms of paid subscriptions, which are what really counts, Netflix still has more accounts in the United States than elsewhere. Netflix has over 50 million paid subscribers in the United States, up by 940,000 in the second quarter to 50.32 million. Netflix has 48.71 million subscribers outside the United States, but the number rose by 3.72 million in the second quarter, with plenty of room for further growth as it continues to ramp up.
Netflix is still losing money internationally as it continues to expand, but expects to make its first profit internationally in 2017.
While television subscriptions are generally declining in the United States, Netflix is continuing to grow its user base, although there appears to be little correlation.
Netflix is continuing to partner with other companies that are reselling its service. It announced a partnership with Altice to package Netflix with SFR services in France and says it s likely to expand this approach to complement its primary direct to consumer approach.
Creating a television network is now as easy as creating an app, Netflix observes, suggesting that while it is a competitive market many boats will rise on the internet tide. “We are all co-pioneers of internet TV and, together, we are replacing linear TV,” it suggested. “The shift from linear TV to on-demand viewing is so big and there is so much leisure time, many internet TV services will be successful.”
Interviewed by an analyst from UBS for its quarterly earnings call, Netflix chief executive Reed Hastings was just saying that mobile was just another screen when the line broke up. “I’m afraid that I can’t hear you any more. There seems to be some AV problem,” he said.
“So the signal that — can you hear me now?” the analyst persisted. “Barely,” replied the chief executive. “You may need to shout”. That seems to characterise internet disruption.