Netflix’s Co-CEO Ted Sarandos has confirmed at the Cannes Lions advertising festival that an a new ad-supported plan will be coming to Netflix, as reported by The Hollywood Reporter. Ads coming to Netflix has been rumored for a while but this is the first official confirmation that it’s coming. The existing tiers will not change and remain ad-free, but at least one new tier will be added, costing less and including ads. This change comes after Netflix lost subscribers last quarter, 200,000 of them, for the first time in a decade. Netflix also laid off 150 employees last month and another 300 this month.
My fear is that it will affect the programming that Netflix will make in the future. Advertisers are often picky about the kinds of content that they want their ads to show on, which could make it harder for ad-unfriendly movies and shows to get made.
HBO will start to ga e solar pressures if they launch an ad-supported tier of HBO Max, as is widely expected.
That’s a really good point. My initial thought was that this won’t affect paid users, but you’re right that it could seriously change Netflix content as a whole if the ad tier is popular.
> if they launch an ad-supported tier of HBO Max
There is already an ad-supported tier of HBO Max mate. Since like last year. I am not even in America and I know this.
They lost subscribers because of the rate increase also when they started putting more liberal shows on like paying the Clintons or the Obama’s I have not canceled mine yet but the next rate increase I am sure to cancel and if they continue to pay liberals a lot of money which makes my rates go up.
It’s awe inspiring to see how people can make absolutely any story on the Internet about political views.
That’s funny. Now they want you to pay FOR commercials, unlike HULU which gets paid to NOT show commercials. TUBIE plays good movies with ads…for FREE! As said above, this is a slippery slope. Netflix’s greed is going to consume them.
Actually, it sounds like Netflix is doing something virtually identical to what Hulu offers. I don’t have Hulu, but my understanding is they have a cheap tier with commercials and another more expensive one without.
Is this not correct?
Peacock has an ads tier that I get ‘free’ with our Xfinity subscription. However I’ve never seen an actual ad the few times I’ve watched anything on Peacock.
HULU has both tiers. The ad supported is about half, but if you hate ads the way I do you won’t make it long into the first month before upgrading to the ad free tier. I found the ads drove me up the wall.
Mark said that what Netflix is doing was “unlike” what Hulu was doing.
It appears to me that it is not. I was asking him if that was actually the case.
I fear Netflix can use the ad tier as an excuse to keep raising prices. Using the cheaper ad tier as the excuse. ‘There’s a tier to support all levels of users’
I think up to this point they’ve been able to raise prices with impunity. That may have baked a bad lesson into the company culture. If you’re a customer, you can recall seeing email notification of increase that condescendingly mention they would understand if this caused you to go elsewhere. That type of calculated arrogance, designed to subliminally convey to the customer that there is nowhere else to go, is probably not going to be present in future notifications.
If there are any.
Netflix’s problem is pretty simple, and it isn’t a couple woke shows or whatever favorite boogeyman your relatives wish you’d shut up about at dinner.
There’s been a tsunami of new and competant competition, as well as a simultaneously large draining by IP owners of properties that used to lock people to Netflix (ie. The Office, Friends, Star Trek, countless classic movies, not to mention the new blockbusters that are now exclusively premiering on other services) During this, Netflix has paradoxically leaned into multiple price hikes.
Demanding a more money for a drastically smaller product in the face of equivalent, or superior, competitors is a pretty reliable way to lose market share.
Nothing more complex than that.
We’ll see if they are receptive to the obvious lesson. The ad tier is one way to attract price conscious customers. Offering something to reward, and thereby retain, long time customers would be another. They haven’t done anything toward that yet.
Speaking of which, Elias, I will pay you for an short term edit function.
It’s comforting to read the ad free tier will be cheaper. In the current inflationary environment it’s a perfect time to introduce the ad free tier at the current lowest tier price and raise all the other tiers.