In a show of supreme confidence in the face of next week's launch of HBO Max, Netflix announced this week that it would start to automatically cancel subscriptions that have been inactive for at least a year.
"You know that sinking feeling when you realize you signed up for something but haven't used it in ages? At Netflix, the last thing we want is people paying for something they're not using," Netflix exec Eddy Wu explained in this blog post.
Netflix, he said, estimates that these inactive accounts represent less than half of 1% of the company's overall member base – in the neighborhood of "a few hundred thousand" – and that the numbers are already baked into Netflix's financial guidance.
The decision to cull some inactive accounts comes after Netflix added 15.77 million streaming subs worldwide in Q1 2020 (clobbering original exceptions of 7 million adds) as consumers flocked to the service as the pandemic took hold. Netflix expects sub growth to slow down in Q2 2020, forecasting global subscription adds of 7.5 million, a figure that would push its grand total past 190 million.
Wu said Netflix subscribers eligible for the culling will start to receive emails or in-app notifications this week. If they don't confirm they want to keep the service, Netflix will auto-cancel their subscription. Notably, subs who cancel and rejoin the service within ten months will still be able to retain their profiles, favorites and other viewing preferences.
"In the meantime, we hope this new approach saves people some hard earned cash," Wu wrote.
Netflix is scrubbing its inactive accounts as HBO Max, which added several distribution partners this week, nears its national launch on May 27, and as NBCU prepares the wide launch of its new streaming service, Peacock, on July 15.
Netflix's proactive, consumer-friendly decision also opened to door for media analysts and industry watchers to chide the struggling pay-TV industry a bit.
The companies with the confidence to make it easy for you to leave are the companies you don't leave.— Joe Nocera (@opinion_joe) May 22, 2020
- Netflix adds 15.77M streaming subs in Q1, pushes global total past 182M
- HBO Max adds distribution partners as launch nears
- NBCU's Peacock premium streaming tiers to fetch $4.99 with ads, $9.99 without
- US pay-TV losses rocket to 2.15M subs in Q1 as virtual MVPD market unraveled
— Jeff Baumgartner, Senior Editor, Light Reading