Netflix had last month announced a cheaper, ad-based subscription plan that the streaming giant is bringing in collaboration with Microsoft. This came soon after Netflix reported that highest loss in the number of subscribers ever, and now the prices of the new ad-based subscription plan have been rumoured.
According to a report in Bloomberg, Netflix is planning to price the ad-based subscription plan between $7 (roughly Rs 560) and $9 (roughly Rs 720). Currently, the streaming platform charges $9.99 onwards for its base plan that only supports one device. In India, the cheapest plan is the mobile plan, which costs Rs 149. The base plan in India costs Rs 199, the standard plan is priced at Rs 499, and the premium Netflix subscription costs Rs 649 per month. Given the India prices, if Netflix brings the ad-based subscription, it is likely to be cheaper than the rumoured $7 - $9 cost.
Netflix had last month announced that it is bringing a new plan in addition to the ad-free Basic, Standard, and Premium plans that will show ads to users. Netflix says that its aim is to give users more options and a better-than-linear TV brand experience for advertisers. In a blog post, Netflix had last month said that it has partnered with Microsoft as the “global advertising technology and sales partner." The company says that Microsoft has the proven ability to support all their advertising needs as the two companies work together to build a new ad-supported offering.
Netflix’s announcement came after the company reported a drop in subscribers in the last quarter. With that, Netflix is making more efforts to acquire new customers. To attract new customers, Netflix will bring a cheaper subscription plan, which will run ads, according to the company. Currently, the cheapest Netflix plan is Rs 149 per month, which gets users the “Mobile" plan that only runs 480p video on one smartphone or tablet at once.
Netflix had announced the ad-based subscription plan last month, bringing Microsoft on-board as a partner for implementation of the new ad-based model
Netflix’s forthcoming ad-supported tier may cost between $7 and $9 per month, according to a report from Bloomberg. Depending on which plan you currently pay for, that could be a significant savings; the company currently offers plans at $9.99, $15.49, and $19.99 per month.
After the company reported that it lost subscribers for the first time in more than a decade, co-CEO Reed Hastings indicated in April the company was ready to consider a cheaper offering supported by advertising, despite years of spurning the idea of ads. Co-CEO Ted Sarandos confirmed the ad tier was in the works in June, and Netflix announced Microsoft as the technological partner helping to deliver ads in July.
Perhaps unsurprisingly, the ad-supported tier will have some downgrades from the no ads plans; executives have said that some content will be missing from the ad tier at launch, while code spotted in its mobile app indicates Netflix may not let users on the ad-supported tier download shows for offline viewing.
NETFLIX IS PLANNING TO LAUNCH THE AD TIER IN A FEW MARKETS BEFORE THE END OF THE YEAR
Bloomberg’s Friday report sheds light on a few more details of the ad tier. The company aims to sell approximately four minutes of ads per hour and wants to show ads ahead of and in the middle of content. Earlier this week, Bloomberg reported that Netflix doesn’t plan to include ads with its kids content or original movies. Netflix is targeting to launch the ad-supported plan in “half a dozen markets” in the final quarter of this year, Bloomberg says. The company plans to launch the tier more broadly in early 2023.
In an email to The Verge, Netflix spokesperson Kumiko Hidaka said that Bloomberg’s report is “all just speculation at this point.” She said that the company is “still in the early days of deciding how to launch a lower priced, ad supported tier and no decisions have been made.”
The new ad plan arrives at a turbulent time. After April’s shocking drop in subscribers, Netflix reported another subscriber drop three months later. Netflix also raised its prices across all of its plans in the US in January — its third price hike in recent years —and is testing ways to turn password-sharing viewers into customers who pay for extra streams. And the company is facing competition from other streaming services like Disney Plus, whose own ad-supported plan is set to launch in December, and HBO Max, which launched a $10 ad-supported plan in June 2021 that comes without downloads or 4K streaming.
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