Disappointing figures as movie streaming firm prepares for UK expansion.
US-based film and TV streaming service Netflix is currently on a mission to increase its 25 million customers by launching in different continents although that could all grind to a halt.
The firm has lost over 800,000 customers in Q3, much more than predicted and it believes there may be more cancellations in the pipeline. It finished Q2 with 24.6 million users while Q3 finished with 23.8 million users.
It seems the drop in customers is a product of the 60 per cent price increase, which saw the unlimited DVD and streaming service rise from $9.99 to $15.98 per month in September.
The news will surely come as a blow to the company, which intends to tackle Europe by launching the mobile and online streaming platform in the UK and Ireland in 2012.
In a letter to shareholders, Reed Hastings, CEO, Netflix, said: "We expect the costs of our entry into the UK and Ireland will push us to be unprofitable on a global basis; that is, domestic profits will not be large enough to both cover international investments and pay for global G&A and technology and development."
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The cost of the service for Britons is currently unrevealed but the firm is going to have to tread carefully and rethink strategies in order to infiltrate the market.
The UK will provide competition from rival firms such as LoveFilm and even Google, which has produced an Android movie rental service for its mobile users.
Hastings' letter continued by saying Netflix is "moving forward as quickly as we can to repair our reputation and return to growth."
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