It's speculated that the remaining business was slipping out of profitability without an overhaul. Users were dropping, movie selection is expensive to maintain, and distribution staff/centers ate the remaining revenue.
I bet it had a lot to do with those sticking around actually being the ones who use the service the most.
Similar to how gyms count on a decent chunk of members coming once a month or even less, but those members basically subsidize the $10/m price for everyone else.
