For the longest time, Netflix refused to offer an ad-supported category like its competitors. But the company changed its tune when it first lost customers a decade ago, with CEO Reed Hastings stating that the company is “fully open to offering lower prices with advertising as a consumer option.” In June, co-CEO Ted Sarandos confirmed that the company would offer an ad-supported subscription plan at a more affordable price. As we approach the end of the year, more details about the service are starting to emerge, and now it looks like we might have a price.
according to BloombergNetflix is considering a price between $7 and $9 for the next ad-supported tier. Currently, the service charges $9 for its Basic plan, $15.49 for its Standard plan, and $19.99 for its Premium tier. Customers who choose the ad-supported plan will experience about four minutes of commercials for every hour of content watched. This is slightly lower compared to traditional cable shows, which feature 10-20 minutes of advertisements per hour. It plans to run these ads before and during the show, but not after. Netflix is currently in negotiations with advertisers and wants to start small so as not to confuse its customers.
It has long been rumored that the company will offer the ad-supported service by the end of the year. Bloomberg It states that the initial rollout will be in a few markets, with a full rollout expected in 2023. Netflix is working hard to find a balance that is good for the company and good for customers. You hope that you can improve your ad experience to avoid issues with other platforms, by being slow to roll out. Later this year, Disney will also introduce an ad-supported tier for its Disney Plus service. Disney Plus is at a loss but recently added 14.4 million subscribers, giving it 152.1 million subscribers. With that, going forward, the competition will be more difficult as streaming services become more robust in pricing and content.
source: Bloomberg
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