Netflix

Netflix's average member watches 2 hours a day. That is the viewing figure.

It is also the churn figure, the pricing figure and the ad revenue figure in the same number.

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Two subscribers. Same £12.99. One watches 2 hours a day. One watches 15 minutes.

Same bill. Very different cancellation probability.

Netflix describes time spent as its "best proxy for member joy" and its primary internal quality metric.

Not subscribers. Not revenue. Hours.

The whole product from recommendations, thumbnails and content spend is aimed at keeping the 2 hours at 2 hours.

Which is why four price rises between 2019 and 2024 barely shifted churn.

At 60 hours a month, £12.99 works out at 22 pence per hour.

A subscriber on 2 hours a day does not cancel over a £2 increase.

Nothing else competes at that price.

A subscriber on 15 minutes a day might, because for them the maths is closer to £155 a year for something they barely use.

The 2 hours also sets the ceiling on ad revenue.

At 4 to 5 minutes of ads per hour, 2 hours a day generates 8 to 10 minutes of ad inventory per user.

Cut average viewing to 1 hour and that inventory halves without Netflix changing a single price.

2 hours a day is not a viewing metric. It is the risk between a subscriber and a cancellation.