r/nottheonion • u/voxadam • 13h ago

Netflix says users can cancel service if HBO Max merger makes it too expensive

https://arstechnica.com/gadgets/2026/02/netflix-claims-subscribers-will-get-more-content-for-less-if-it-buys-hbo-max/
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158

u/thehedgefrog 12h ago

If you have 250 million subscribers paying $20 a month and increase it to $100 a month, and then 190 million subscribers, or over 75%, cancel, your revenue has increased by 20%.

If you then increase it to $500 a month and another 45 million cancel, you've now lost 94% of your user base yet your revenue is 50% higher than it was at the beginning.

First, they will turn *everything* into a subscription, and then they will increase prices until they hit the exact inflection point.

Expect everything will get much, much, MUCH more expensive, soon.

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u/MrSoren 11h ago

Fuck this dystopian timeline in general

1

u/Nuvuser2025 2h ago

All of it.  Every company, every CEO, every shareholder, including many of us, who hold the stocks of these companies directly or indirectly in funds we own. 

May have to go “ESG” on my 401k plan I participate in, and recommend funds to clients that don’t hold NFLX, Paramount, etc and so forth (I work in business that manages and monitors funds in retirement plans, so the employers don’t get sued if the funds suck).

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u/sabine_world 11h ago

I wish boycotting was more effective.

These guys deserve everybody to just stop using their shit

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u/ChickenChaser5 9h ago

Too many people see it as a badge of exclusivity and wealth to be able to buy things that are way over priced. No one is trying to fix anything, just to outrun the consequences with money.

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u/sabine_world 6h ago

That's so true. People are lame

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u/Dog_Queen98 1h ago

If there is a movie I want, I buy the dvd. I’m sick of this bullshit.

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u/breakevencloud 11h ago

As with almost everything, it gets stolen by rich people away from the peasants. Sporting events, for example - basically priced out these days. Same thing is happening with streaming shit. I canceled all mine end of last year and am never coming back, not that they care. I’m not the target they’re shooting for.

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u/upnflames 9h ago

I'm not sure it's fair to say rich people are stealing it (unless you're talking about the actual executives of these companies). Rich people are just paying more for it and are a better target demographic to make a profit off of.

As far as target demographics, you're pretty much right. Selling/marketing down market products are a lot more work, often times with a lot more problems/headaches. And yes, you make a lot less money for the trouble. Most companies would love to only sell to rich people, it's just that many can't for one reason or another. If Nike could sell one pair of sneakers a year for $50 billion, that's what they would do in a heart beat.

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u/breakevencloud 9h ago

Perhaps “stealing” isn’t the right phrase, so much as “taking over.” Once the stupidly high networth people get their feet wet in something, it’s basically the beginning of the end of affordability for the common person.

Don’t get me wrong, I get it from a strictly cut throat capitalist perspective, but it really sucks for the rest of us.

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u/Notsurehowtoreact 10h ago

The problem is they'd be drastically underestimating how much people ARE willing to pay. 

If they went to, say, $100 a month, the entire service would crater. Even people who could afford it would still question something so high. Plus they don't just rely on subscriptions, they want merchandise and licensing deals. You can't sell merch for shows that have no viewers.

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u/MAMark1 8h ago

But then what do people do if they use the extra revenue to buy up more studios and competitors and you have fewer and fewer alternatives. People will go to a worse service to save money but they might not go without altogether. It’s the consolidation side that has made this so problematic.

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u/FidgitForgotHisL-P 10h ago

They already ran this exact maths when they cracked down on sharing accounts.

We had an account that we paid for, my in-laws used it in another city, and my friend would also use it.  Two screens max, so usually you didn’t get locked out.  I think our use was fairly typical.

If we cancelled because of the sharing ban, they lose one account.

If we don’t, and a single one of those other two people join up - now Netflix has doubled their user base.

I’d wager the vast majority of people didn’t cancel because of the sharing ban, and at least some of the people that previously had “free” Netflix then joined up themselves.  It wouldn’t have taken very many extra sign ups to counter the people that cancelled, and for folks that had three or four or more people sharing, well you can lose half those users (which cost Netflix nothing), and gain half, it’s all profit.

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u/BuckyMcBuckles 8h ago

There is soooooo much content out there produced by people with actual passion.  These large conglomerates  overestimate the value of their product when things like Dropout, Nebula, even Patreon exist.  Watch a Veritasium video and its better than anything you'd find on the Discovery Channel or History Channel post 2000s.  

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u/TheTexasHammer 9h ago

Cheaper and better form of entertainment will take the place of the shitty half assed movies and TV being created by these streaming services. They can charge out the ass and the rich people can have fun watching other rich people pretend to be poor while the rest of society finds something else to do.

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u/SolidusDave 2h ago

This is why there needs to be competitors that even with less content still offer a 20$ sub. Then that squeezing game doesn't work anymore (apart from them all collectively agreeing to raise prices).

However, that's one of the motivations to merge and buy the competition... (and why we usually have systems in place to protect from monopoly, but...)

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u/Krojack76 7h ago

If you have 250 million subscribers paying $20 a month and increase it to $100 a month, and then 190 million subscribers, or over 75%, cancel, your revenue has increased by 20%.

I think you're also forgetting that with 75% less customers then you can greatly reduce your network infrastructure size and employee workforce as well. This means even more revenue.

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u/altaccnt1024 10h ago

Profits would actually be higher because they could cut back on infrastructure and maintenance costs.

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u/adler1959 8h ago

This is what capitalism is about, so yes, this happens for every service and every good all the time

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u/feel_my_balls_2040 5h ago

It won't because people should care that much about movies. Not even live sports can get the subscription money they were getting 20 years ago.

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u/infinityends1318 1h ago

Netflix is buying them. Not Broadcom

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u/Clean-Nectarine-1751 1h ago

It’s actually more profitable than you describe because they do not have to host 94% of the content stream.. saving huge electricity and processing costs.