Netflix plans to introduce ads

A cheaper Netflix plan may soon be supported by ads (Future Publishing via Getty Images)

Netflix has revealed plans to introduce ads as a way to make a cheaper subscription available to viewers.

During a quarterly meeting with investors, Netflix CEO Reed Hastings explained that building ads into the service would give consumers “choice.”

Hastings said he has traditionally been “against the complexity of advertising and a big fan of the simplicity of subscriptions.”

“But as much as I’m a fan of that, I’m a bigger fan of consumer choice,” he added.

“And letting consumers who want a lower price and who are ad tolerant get what they want makes a lot of sense.”

At the moment there is no advertising at all for the service. Viewers can instantly jump in and out of shows or movies. That experience is partly in the monthly pricing structure.

But there may be another reason Netflix wants to be able to offer a lower-priced tier — to get more people to use the service.

According to the Wall Street Journal, Netflix lost 200,000 global subscribers in the first quarter of 2022 and expects to lose 2 million more this spring.

As a result, the company’s shares fell 17% after hours.

The reasoning behind this is quite simple; as the cost of living for people rises, luxury goods like Netflix are the first to be cut.

Moreover, there is a lot of competition in the streaming space from the likes of Amazon Prime, Apple TV+ and Disney+.

(FILES) This file photo, taken on October 19, 2021, shows the Netflix logo on the Netflix, Inc. building on Sunset Boulevard in Los Angeles, California.  Streaming giant Netflix has suspended its service in Russia, US media reported on March 6, 2022, in protest of Moscow's invasion of Ukraine.  (Photo by Robyn Beck/AFP) (Photo by ROBYN BECK/AFP via Getty Images)

Netflix expects to lose more subscribers this spring (Credits: AFP)

However, it doesn’t look like Netflix’s ad-supported tier will arrive yet.

Hastings said Netflix will look into exactly what this idea could look like “in a year or two.”

Which probably means figuring out what kind of ads are allowed. Will it be a 30-second pre-roll ad similar to YouTube or a longer segment that breaks up a show like traditional TV?

Anyway, it’s coming.

Hastings added: ‘See us as quite open to offering even lower prices with advertising as a consumer choice.’

How much does Netflix cost in the UK?

Earlier in March, Netflix announced it would increase the price of its subscriptions by £1 for both new and existing customers.

Netflix’s basic subscription, which lets you watch one screen at a time in standard definition, now costs customers £6.99.

Bridgerton

You can stream Bridgerton for just £6.99 a month (Picture: Liam Daniel/Netflix)

Their standard subscription now costs £10.99 per month, giving you and anyone else with access to your account the ability to tune in on two different screens at once and watch content in High Definition.

The Premium plan is the most expensive, now costing £15.99. This allows you to stream on four screens simultaneously in HD and Ultra HD.

MORE: More than 1,500,000 cancel Netflix, Disney+ and Now TV due to livelihood crisis

MORE: ‘There were too many Asian workers’: Abercrombie & Fitch staff expose vile racist abuse in horrific Netflix documentary

Leave a Comment