Netflix Plans to Introduce Ad-Supported Plans at a Cheaper Cost
Netflix is reportedly looking to introduce new ad-supported plans, providing cheaper subscription options to subscribers. This quickly follows as the streaming service reports that it lost 200,000 subscribers across Q1 2022.
The company is said to be looking into possibilities of an ad-supported tier “over the next year or two,” says Netflix co-CEO Reed Hastings during its earnings call. According to The Hollywood Reporter, Netflix COO Greg Peters stated that advertising “is an exciting opportunity for us.”
“Those who have followed Netflix know that I have been against the complexity of advertising, and a big fan of the simplicity of subscription,” Hastings said. “But as much as I am a fan of that, I am a bigger fan of consumer choice. And allowing consumers who would like to have a lower price, and are advertising-tolerant, get what they want, makes a lot of sense.”
Hastings went on to identify the successes of Netflix’s competitors. The company is looking at streaming services like Hulu. “It is pretty clear that it is working for Hulu, Disney is doing it, HBO did it. We don’t have any doubt that it works,” Hastings went on to say. It appears as though Netflix may introduce a model similar to Hulu’s in the US.
The report goes on the confirm that Hastings was adamant about introducing ads without data tracking and ad-matching. Instead, Netflix will serve as an advertising publisher when ads are folded in.
Currently, Netflix offers three plans in Canada. The Basic plan is available for $9.99/month and offers 480p streaming to one device. Standard, on the other hand, is available for $16.49/month and enables 1080p streaming on up to two devices. The $20.99/month Premium plan covers 4K HDR streaming on up to four devices. Introducing an ad-supported tier could bring down the entry-level cost to something comparable to Apple TV+, which costs $5.99/month.