The recent pounding of Netflix's stock price after the company missed Q2 subscriber forecasts shows how predicated its current value is on subscriber growth. But Netflix's own drama will be a story in two parts. Netflix has always been a TV company, run like an Internet company. And Internet companies, as we all know, chase user growth first, profits later. If part one of the Netflix growth story has been about customer additions, part two will be about ARPU growth. Switching from one to the other will be the key to long-term success. Netflix needs to push the classic 'pay TV' strategy of tiering. A process already well underway. The reality is that if Netflix had grown its ARPU by 27% in 2017 (an additional 17 percentage points over what it actually achieved), it would have wiped out its FCF deficit to become FCF neutral. Growth of 27% sounds like a tall order for any company. But on a very low ARPU to start with, that equates to an additional per-customer spend of just $1.68 per month on its current customer base. Recent ARPU growth trends suggest this may be easily achievable. Full analysis in our Profile Report 'Netflix Growth Drama'.