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Netflix suffers sharp decline in approval rating

August 1, 2012

According to new research from TDG, Netflix is experiencing a significant decline in satisfaction among its streaming users. “The impact of its ill-conceived price and packaging change of late 2011 continue to resonate today,” notes Michael Greeson, TDG Founding Partner and Director of Research.

TDG notes that in mid-2011, two-thirds of Netflix streamers were highly satisfied with the service, but now, less than half are highly satisfied, a decline of 29 per cent in just 12 months. “While declines of this magnitude should be of concern to investors and subscribers alike, it is important to note that the shift appears to have been from ‘highly satisfied’ to ‘neutral’, not to ‘highly dissatisfied’,” observes Geeson.

Despite this trend – and despite Wall Street’s continued punishment – TDG says that Netflix remains dominant in over-the-top video services and has become the default choice for fee-based OTT services on virtually every streaming video platform, be it a game console, Blu-ray player, Internet set-top box, smart TV, tablet, or smartphone.

“Let’s be clear: connecting one’s TV to the Internet is now a mainstream phenomenon,” says Greeson. “Unlike the early days, Netflix must compete with a variety of streaming services, including big brands such as Amazon and Wal-Mart (Vudu), studio-funded efforts like Hulu Plus, and expanding operator video-on-demand services. Netflix’s early mover advantage is quickly evaporating, and unfortunately at the same time service satisfaction is declining.”

Categories: Articles, Consumer Behaviour, Markets, OTT, OTT, Research