Netflix Surrenders, Now Offers A Cheaper Ad-Supported Tier Since November 2022

Credit:Tubefilter

 

Netflix is the latest subscription-based streaming service to offer ad-supported tier subscription plans. On October 13, 2022, Netflix announced plans for a cheaper, ad-supported tier called Basic with Ads, set to kick off on November 3.

The announcement comes barely six months after the company introduced a new optional lower-priced ads plan to help it fend off the onslaught of stiff competition from other subscription-based streaming service providers, compounded by a jarring loss of Netflix subscribers for the first time in ten years.

Netflix shares dropped significantly after the company reported losing about 200,000 subscribers in its first quarter earnings report. Netflix's co-CEO Reed Hasting responded by saying the company will consider launching an ad-supported tier. Initially slated to launch in early 2023, the roll-out date got moved forward to November 2022, with Microsoft chosen as its advertising technology and sales partner. 

Source: Microsoft Advertising

 

Netflix reported 220.67 million paid subscribers as of July 2022, a figure that currently stands at nearly 231 million global subscribers as of January this year. The streaming giant brought in over 7.66 million new subscribers during Q4 of 2022 but said over 100 million households are watching Netflix without paying for it, thanks to password sharing. The company said it is "in the early stages of working to monetize" those users – hopefully, the new ad-tier plan will help it achieve that goal.

The new Basic with Ad subscription tier costs $6.99, $3 less than its cheapest "Basic" plan. Netflix's other pricing plans include Standard and Premium, costing $15.49 per month and $19.99 per month, respectively. The Basic with Ads tier is available to customers in the US, UK, Australia, Brazil, Canada, France, Germany, Italy, Japan, Korea, Mexico, and Spain.

The drawback with Basic with Ads is the inability to download movies to watch offline and the few shows that aren't available with the new ad-supported tier due to licensing issues. Besides these, Netflix says Basic with Ads "is everything people love about Netflix, at a lower price, with a few ads in-between." The ads currently run for 15 to 30 seconds, coming on at the start of and during programs, and averaging roughly 4 to 5 minutes per hour.

Netflix isn't the first streaming service to explore similar ad-supported tiers to attract and keep users. Hulu, for example, offers a $7.99-a-month ad-supported plan, compared to the $14.99-a-month regular option without the ads. It's easy to sign up at Netflix's website by providing your email, date of birth, and gender to get started.

 

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