Netflix is facing a potential loss of subscribers due to the ongoing writers’ strike, which began on May 2. The Writers’ Guild of America (WGA) and the Alliance of Motion Picture and Television Producers (AMPTP) are in a dispute over better working conditions and compensation, with the rise of artificial intelligence, such as ChatGPT and Bard, adding to concerns that writers could be replaced. Industry insider Jeff Sneider has claimed that Netflix is being blamed for the breakdown in talks, as the company is reportedly refusing to make a deal to show transparency on streaming numbers. Some WGA members and Netflix users have cancelled their subscriptions until the strike is resolved. While it remains unclear how much impact the rumours will have, it is possible that the delay in popular shows like Stranger Things season 5 and Squid Game season 2 could lead to more subscribers ending their memberships.
Although Netflix lost subscribers in 2022 due to the cost of living crisis, CEO Ted Sarandos has said that the streaming platform can “serve our members better than most” during the strike, thanks to a large base of upcoming shows and films from around the world. It is unclear how the strike will impact Netflix’s revenue streams and subscriber base in the long run. While the rumour about the company’s involvement in the strike may not have caused a tidal wave of cancellations yet, a delay in the return of popular shows could be a tipping point for some subscribers.
Netflix’s stock price has already dropped by 1.7% since the strike began, according to Vanity Fair’s Gabriel Sherman. The writers’ strike could lead to more losses for the streaming giant, which is already dealing with password-sharing crackdowns in some regions. However, Netflix is bullish on its prospects, believing that users will reactivate their accounts or sign up for the first time when they hear about its latest big hits.
