US Netflix subscriptions overtook HBO subscriptions in 1Q.
Netflix has become major competition for premium and cable TV networks as it now surpasses HBO in U.S. subscribers.
The video streaming service now has 29.2 million U.S. subscribers out its over 36 million subscribers worldwide, having added over 2 million U.S. subscribers in the first quarter of 2013 alone. In comparison, HBO currently has 28.7 million subscribers and isn’t expected to see much growth as the cable TV industry continues to suffer from a lack of new subscribers, according to Quartz.
Having faced immense profit losses a year ago, Netflix has seen considerable growth over the last several quarters and announced $3 million in profit and $1 billion in revenue for the past quarter. The company’s recent successes prompted shares of its stock to jump almost 25 percent on Monday following quarterly earnings reports.
Netflix has been dubbed the most watched “cable network” in the U.S., despite not being a cable network. Subscriptions go for $8 a month, which allows members have unlimited access to the complete Netflix streaming library. Members can also rent DVDs, which are shipped to their homes. The service reportedly garners 87 minutes of streaming viewership per US household daily, more than any American cable network.
HBO, on the other hand, is a premium cable channel that must be bought on top of a basic cable subscription. Though HBO also now offers HBO Go, a free subscription add-on that allows members to stream HBO content over the Internet, the appeal in Netflix is its ability to stream a vast library of popular movies and TV shows, and has now begun to offer its own original programming, which Netflix says is responsible for its recent boost in U.S. subscribers.
Netflix's new shows, including the critically-acclaimed show “House of Cards” and the recently premiered “Hemlock Grove," mimic the same way HBO originally gained popularly; it introduced its first original series “Oz” in 1997, and went on to release even more popular shows such as “Sex and the City” and “The Sopranos.”
Netflix officials have noticed these similarities and plan to use them to the company’s advantage. Netflix’s CCO Ted Sarandos was recently quoted as saying “The goal is to become HBO faster than HBO can become us.”
Netflix has recently introduced a new “family” subscription option that will allow up to four simultaneous streams per account for $11 per month. The current option only allows for two simultaneous streams. Netflix says it doesn’t expect the option to be immensely popular, projecting just one percent on subscribers to choose the plan; however, it will be good for large households and for those who wish to share accounts with friends.
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