Netflix continues to dominate the entertainment streaming landscape with the most subscribers, but why is it still the king of streaming in 2021?
The streaming market has been growing over the last couple of years, with new competitors emerging to take Netflix on and vie for its number one spot. Despite that, Netflix stands firm at the top.
In this article we’ll cover all the factors that make Netflix the standout streaming service to date, despite the challenges it has faced in the past year.
How Netflix Fares Against Its Competitors
It's no secret that Netflix dominates the streaming wars with an army of more than 200 million subscribers—the most in the market. If anything, the war is among Netflix's competitors as Netflix leads the market significantly, despite new competitors like Paramount+.
And the streaming giant's reign doesn't seem to be under threat for the time being. While Netflix has a contender in Disney+, which has about 100 million subscribers, Disney+'s subscriber growth is slowing after a price hike.
And when it comes to original content, Netflix seems to be getting it right if its accolades are anything to go by. Since Netflix won seven Academy Awards in 2021, nearly doubling its all-time tally, it now officially has the most Oscar wins among its competitors.
Netflix Continues to Grow in 2021, Despite Challenges
Like many companies, Netflix had a rough 2020. In a Q1 2021 earnings interview, Netflix CFO Spencer Neumann admitted the company lacked new content coming into the year as a result of pandemic-delayed production. This, he stated, led to the slower-than-expected membership growth reflected in Netflix's Q1 results.
However, if you think this means Netflix didn't add enough subscribers, you're wrong. The company enjoyed unprecedented membership growth as a result of the pandemic in 2020.
Netflix's shareholder letter reports the company saw over 40 million new subscribers join the streaming service, 73% of which said they will definitely keep the service going forward, according to a "2021 Predicting the Pandemic" report from Hub Entertainment Research.
In other words, despite failing to meet its forecast, Netflix ended 2020 with a bang: a larger membership of 208 million subscribers and a bigger revenue base than it would otherwise have had, which translated to record revenues in the first quarter of 2021.
Fueled by this growth in revenue, Netflix now seeks financial stability. The company plans to be cash-flow neutral in 2021 and cash-flow positive every year thereafter, hoping it will no longer need external financing to fund its operations. It will also consider share buybacks for the first time since 2011.
