After losing 1.2 million subscribers in the first six months of 2022, Netflix (NFLX -1.51%) was able to add 10.1 million net new members in the second half of the year. And this has helped drive the stock price higher: It's up 100% off its 52-week low (as of this writing). 

However, with revenue growth of just 6.5% in 2022 compared to 2021, along with the cutthroat competition in the streaming industry today, investors are worried that Netflix's days of dominating the space are a thing of the past. I'm here to ease these concerns.

Here's why Netflix is still the clear leader in streaming.

Turn on the TV and press play 

According to data from Nielsen, Netflix accounts for the most hours watched on TV in the U.S. of any streaming service, with 7.5% of viewing time. Hulu was in second place at 3.5%. This trend has been boosted by the fact that streaming is steadily taking over our living rooms. In January 2022, streaming made up 28.9% of TV viewing time domestically, compared to 38.1% a year later. And during that same time, both cable TV and broadcast TV have seen their shares shrink. As a result, streaming is easily the most popular method of video entertainment. 

This rising tide works in Netflix's favor. With 2022 revenue of $31.6 billion and 230.8 million members, it is the largest stand-alone streaming service out there. Walt Disney has a total of 234.7 million subscribers across its various services. The largest of them, Disney+, has 161.8 million members now, but it only accounted for 1.7% of TV viewing time. And Amazon Prime, at 2.9% of viewing time, is estimated to have more than 200 million members, but it's hard to say how many of them use the video-on-demand offering. 

Netflix initially launched its streaming service in the U.S. in 2007, meaning it has now been a pioneer in the space for about 16 years. Having a first-mover advantage has certainly benefited the company. At first, Netflix was selling primarily a better user experience, allowing customers to watch what they wanted, whenever they wanted. This was better than the expensive and time-prohibitive nature of traditional cable TV.

But now, Netflix must compete on content, an area that it has shown it can excel at. It has won numerous TV and movie awards. And the company is now one of the biggest spenders on content, laying out a total of more than $34 billion in cash in 2021 and 2022. For smaller streaming rivals, it's no doubt extremely difficult to keep up with this. 

There is one aspect to Nielsen's data that is worth mentioning, though. Alphabet's YouTube accounted for 8.6% of TV viewing time in January, and this was up considerably from just 5.7% in January 2022. This might be a concern for Netflix on the surface, but the caveat is that YouTube specializes in free user-generated content, so it's not a true apples-to-apples comparison to Netflix. This makes YouTube far more accessible to a vast number of viewers out there. To be clear, included in this metric is YouTube TV, but it is estimated that this service only has over 5 million subscribers (as of July 2022). 

Netflix's steady rise in taking control over more of our TV viewing time, especially when consumers have a vast number of options at their fingertips, clearly demonstrates that while the industry continues to be incredibly competitive, the company's content still shines. This should ease any worries that shareholders have about Netflix's standing as the most dominant player in the industry.

This could support a higher user base over time, which supports a bullish case for the stock.