They can (and indeed do) calculate the direct effects by the price increase, and the initial loss of users is expected.
What I think they lack good models for is customer loyalty in a deeper sense. Sure, a lot of people are going to stick around in the short the short term, but Netflix is completely eradicating the competitive advantage it had a few years ago. These decisions might very well maximise profits in the short term, but in the long term I think they’re undermining the very things that made Netflix such a success in the first place.
They can (and indeed do) calculate the direct effects by the price increase, and the initial loss of users is expected.
What I think they lack good models for is customer loyalty in a deeper sense. Sure, a lot of people are going to stick around in the short the short term, but Netflix is completely eradicating the competitive advantage it had a few years ago. These decisions might very well maximise profits in the short term, but in the long term I think they’re undermining the very things that made Netflix such a success in the first place.