Netflix’s subscriber base trumps HBO, new Family Plan ready to go

By Ted Kritsonis April 23, 2013

Netflix-Announces-12-Plan-for-Large-Families — Image used with permission by copyright holder

Netflix announced its quarterly earnings today and the results seem to reflect the bold moves the company has made in the last year. Netflix’s U.S. subscriber base edged out HBO’s in the first quarter of 2013, and the company will also introduce a new optional $11.99 Family Plan to accommodate homes with more than two users.

There was a jump of 2.03 million subscribers in the U.S. over the first quarter, which may have been precipitated by exclusive content with shows like House of Cards, Hemlock Grove and the upcoming revival of Arrested Development. CEO Reed Hastings did say that there are plans to “double down” on original content, but didn’t elaborate on what might be coming down the pipe. In an interesting tidbit, he said that of all the users who signed up for a 30-day trial as House of Cards became available, less than 8,000 opted not to continue on after it was up.

Netflix reported 29.17 million total paid subscribers in the U.S. for the first quarter, surpassing the 28.7 million subscribers HBO had racked up by the end of last year. This is a significant milestone, considering HBO is the number two premium TV channel in the country after Encore, and that Netflix isn’t even on cable to begin with.

Netflix’s base is usually single user accounts, but the new optional Family Plan would double the number of simultaneous streams allowed from two to four. This solves the problem of having more than two people streaming content using the same account. With the new plan, four can stream whatever they want at the same time using the same account, except the recommendation engine doesn’t distinguish between users, meaning results could vary based on the tastes of multiple users.

The company doesn’t expect more than one percent of subscribers to buy in to the new $11.99 plan. Hastings also downplayed rumors that a price hike would be forthcoming, adding that the current $7.99 pricing structure is serving the company well, as is.

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A tech journalism vet, Ted covers has written for a number of publications in Canada and the U.S. Ted loves hockey, history…

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