According to a Bloomberg story, Netflix’s upcoming ad-supported tier may cost between $7 and $9 per month. That might be a considerable savings, depending on whatever plan you now pay for; the company currently offers options for $9.99, $15.49, and $19.99 per month.
Co-CEO Reed Hastings said in April that the business was willing to contemplate a less expensive product financed by advertising, despite years of rejecting the idea of commercials, after the company announced that it lost subscribers for the first time in more than a decade. In June, co-CEO Ted Sarandos said the ad tier was in the works, and in July, Netflix named Microsoft as a partner in the technology that will assist serve advertising.
Unsurprisingly, the ad-supported tier will have some limitations compared to the no advertisements plans. Executives have stated that certain content will be missing from the ad tier at launch, and code discovered in the Netflix mobile app suggests customers may not be able to save video for offline watching.
NETFLIX IS PLANNING TO LAUNCH THE AD TIER IN A FEW MARKETS BEFORE THE END OF THE YEAR
The article from Bloomberg on Friday provides some additional information on the ad tier. The corporation wants to sell four minutes of advertising per hour, and they want to place those commercials before and in the middle of programming. This week, Bloomberg reported that Netflix did not intend to integrate advertisements with its original movies or children’s programming. According to Bloomberg, Netflix plans to roll out the ad-supported plan in “half a dozen markets” during the latter quarter of this year. Early in 2023, the corporation intends to launch the tier more widely.
Netflix representative Kumiko Hidaka wrote in an email to The Verge that Bloomberg’s claim is “all just speculation at this point.” She stated that “no decisions have been made” and that the company is “still in the early days of deciding how to introduce a lower priced, ad supported tier.”
The timing of the new advertising strategy is problematic. Three months after the startling decline in subscribers that occurred in April, Netflix reported another decline. In the US, Netflix also increased rates in January across all of its plans — the third price increase in recent years — and is exploring ways to convert password-sharing users into paying customers who purchase additional streams. Additionally, the firm will battling against other streaming services like Disney Plus, whose own ad-supported plan will debut in December, and HBO Max, which debuted a $10 ad-supported plan in June 2021 without downloads or 4K streaming.
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