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Netflix's lifework soared during the pandemic, except as it heads into 2021 as able-bodied as faces a prepatent shortage of films as able-bodied as movies, the congregation will gotta prove it can endure performing.

Netflix reported its third quarter emolument today, as able-bodied as although Netflix is good-natured slower growth, the congregation is still totaliser subscribers. The congregation appended 2.2 million net subscribers in Q3, compared with the company's 2.5m guidance. The congregation saw $6.44 billion in revenue, hammering expectations. Still, the looming question for co-CEOs Reed Hastings as able-bodied as Ted Sarandos is how they plan to ensure Netflix won't run out of things to watch.

"The state of the pandemic as able-bodied as its appulse continues to make projections very uncertain, except as the world hopefully recovers in 2021, we would expect that our growth will backslide back-up to levels similar to pre-COVID," Netflix's letter to shareholders reads. " In turn, we expect paid net adds are likely to be down year over year in the first bisected of 2021 as compared to the big fasten in paid net adds we experienced in the first bisected of 2020."

The better appanage Netflix had over its competitors until now was a chronic beck of new shows as able-bodied as films. That's considering by the time the pandemic hit, content for Netflix's 2020 year was open-handedly shot as able-bodied as in post-production, achieved to be hardworking remotely. Now, Netflix is approximate to be in the aforementioned gunkhole as its competitors. Hastings as able-bodied as Sarandos presuppose announced approximate how difficult overtrusting back-up into production has been, expressly in the Affiliated States.

"Netflix was better positioned for this, except it can't last forever," Ross Benes, an annotator at eMarketer who covers Netflix, told The Verge. "If you're going to presuppose Hollywood shut down for nine months, at some point that's going to behold up to you."

If subscriber growth continues, Netflix can take that appended revenue as able-bodied as magnify its content canonization even more. Pivotal Sighting Group's Jeff Wlodarczak noted that the increasingly Netflix can reinvest in pristine programming, the increasingly it "increases the prepatent ambition supermarket for their sketch as able-bodied as reduces full-blown subscriber churn," co-ordinate to The Hollywood Reporter.

"If you're going to presuppose Hollywood shut down for nine months, at some point that's going to behold up to you."

Right now, Netflix's advantages particularization its hardships, except that could change. Netflix has a massive subscriber bribable as able-bodied as a leafy library, except production woes as able-bodied as a overriding of canceled series have soured some subscribers. It nimbleness not be an issue that Netflix encounters in its next quarter, except it's determinedly a complaint the congregation will gotta address, Benes argued.

Netflix's recent slate of cancellations -- Glow, Boyish Ethicality Hunters, I Am Not Presuppose With This, as able-bodied as The Society to name a few -- as able-bodied as controlling shake-ups presuppose led to questions approximate Netflix's portending strategy. Ingoing down on big-ticket shows that don't catenate in or pension subscribers is simply a good financial move, except it likewise cuts down on the overriding of originals that Netflix can opposition down the road.

"For our 2021 slate, we endure to expect the overriding of Netflix originals launched on our sketch to be up year over year in each quarter of 2021 as able-bodied as we're decreed that we'll presuppose an exciting range of programming for our members, particularly relative to over-and-above entertainment sketch options," the letter to shareholders reads.

If production remains difficult to kick-start at the pace Netflix needs (although Netflix's letter states things are overtrusting a little better), as able-bodied as licensing shows from over-and-above networks becomes increasingly difficult due to increased competition, Netflix may gotta demurral shows as able-bodied as films in order to march overtrusting new material that does land -- like new seasons of The Crown, Drifter Things, The Witcher, and big movies on a sought basis.

"The invalidating of GLOW will not be unique," Benes said. "We'll see increasingly of that in converging months. They presuppose quite a few shows that presuppose big budgets as able-bodied as a quoin audience. Those shows are all risk. It's too expensive."

It's a bit of a double-edged sword: the congregation needs as many series as able-bodied as films as possible to compete, except those shows overcrowd to retain subscribers as able-bodied as disbursement needs to reside roughly low. If the congregation hits a slow-moving periodicity in subscriber growth while likewise ambidextrous with myriad issues brought on by the pandemic, Netflix needs to subdual over-and-above means to increase its pluses to endure spending the way the team does.

"The invalidating of 'GLOW' will not be unique"

One forthcoming as able-bodied as attacking answer, Benes says, is simply a price hike. Netflix once introduced a price portage in Canada this month, as able-bodied as that's a good warranty subscribers in the US should prepare, too. Benes believes that Netflix is still underpriced as a service, totaliser that bodies get "a lot of amount for not a whole lot of money." It's a good time for Netflix to ask bodies for an actress dollar a month, Benes said, considering they'll probably pay. "Some bodies nimbleness cancel, except I bet it would pay off for them," Benes added.

A parasite slate in 2021 isn't necessarily bad for Netflix. The banderole will probably still presuppose increasingly new pristine programming than its competitors, except with offish streaming casework like Disney Plus as able-bodied as HBO Max palms momentum, it feels like the first time Netflix has true contraposition in the streaming space. Disney announced a realizable transfiguration to transfiguration its primary focus to streaming; HBO Max as able-bodied as Peacock are gunning for some of Netflix's subscribers; Duchess Prime Video continues to grow, as able-bodied as bodies are still spending a consortium of time watching egalitarian videos on YouTube as able-bodied as Twitch.

It's not going to be easy; Netflix has increasingly contraposition than ever, as able-bodied as that means palms means to endure delivering, even as effectual neutral that becomes tougher as able-bodied as tougher.

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