Netflix, Inc. (NASDAQ:NFLX) occupied the ninth position after a robust analysis of the Top Grossing apps on the iTunes App Store. It is probably the introduction of in-app subscription option by Netflix which led to increased proceeds on iTunes that ranked it at this position.
It was unlikely that Netflix could make it on the already Top Grossing Apps Chart which liberated by streaming services of one sort, or another likes of Spotify (#1), Pandora Media Inc (NYSE:P) (#3), HBO NOW (#4), China’s iQIYI (#7), and Hulu (#8).
Netflix has always shied away from presenting in-app purchases perhaps as a result of Apple Inc. (NASDAQ:AAPL)’s steep 30% cut of in-app purchase revenue. However, things took a different turn in September when it began acknowledging sign-ups from new clients within its iPhone and iPad applications hence joining its rivals, Hulu and HBO NOW.
Typically and as expounded by App Annie it takes close to a month to regulate and give proper feedback of how well a new subscription model is working. Perhaps it is because new customers must be offered a 30-day free trial period that must elapse before the final results are conveyed. And Netflix having given in to the subscriptions in September means that it only started seeing the monetization momentum late October, which led to its current ranking.
The ranking is a clear indication that Netflix’s app is responding well to the US market having progressively ascended into the top grossing ranks. And given that U.S. is its prime and most highly infiltrated market, then revenues are set to shoot to higher levels even though net ads year-over-year may drop in some of the quarters to come.
However, even with the saturated US market, there is still room for growth. It is estimated that the users of Netflix’s over-the-top video service will increase to 71.7% in 2019, up from 63.2% in 2015. Hulu and Amazon will also not be left behind as they expect a growth of 33.1% to 41.2% and 44.4% from 36%, respectively which will come from connected TV users.
People are no longer using the legacy technology and have instead shifted to newer set-top boxes and streaming sticks. And with Netflix’s app alongside its rivals is likely to maintain their positions for some time.