Netflix Is Open to Offering a Free Ad-Supported Tier

Netflix Is Open to Offering a Free Ad-Supported Tier

Netflix Co-CEO and chief content officer Ted Sarandos says the company is open to launching a free, ad-supported tier at some point in the future.

Netflix might enter the “FAST” market with a free ad-supported option for watching its content — but audiences shouldn’t hold their breath just yet.

Speaking on Netflix’s fourth quarter earnings call, Co-CEO and chief content officer Ted Sarandos indicated that the company was considering expanding to include a free ad-supported tier. “We’re open to all these different models that are out there right now,” he said. “We’re keeping an eye on that segment, for sure.” However, Sarandos made it clear that it wouldn’t be coming any time soon, as the company only recently launched its paid ad-supported tier and is still in progress on the “paid sharing” system, which will crack down on households sharing passwords. “We’ve got a lot on our plate this year.”

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FAST models of streaming television have become increasingly popular as the ever-growing number of paid streaming services has led to rising expenses for consumers. Currently, existing services which are either entirely free and ad-supported or have it as an option include Roku, Amazon Freevee (previously IMDbTV), PlutoTV, Peacock and Tubi.

Netflix’s first ever ad-supported tier, Netflix Basic With Ads, was announced in April 2022 and launched in November. At $6.99 a month, the plan offers a $3 discount on ad-free Netflix Basic subscription in exchange for 15 to 30-second ad breaks before and during TV shows and films. Due to licensing restrictions, not all of Netflix’s catalog can be watched on the Basic With Ads plan, and downloading content for watching offline is also not available. Following the launch, Sarandon suggested that there were more levels coming to the ad-supported plan in the future, saying, “[W]e have multiple tiers today, so it’s likely we’ll have multiple ad tiers over time.”

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Netflix Is Going Through Changes

As previously mentioned, Netflix is set to begin cracking down on password sharing this year following several months of trials in Latin America. The new location-based rules will require anyone wishing to share their account with someone they don’t live with to pay an additional fee on top of their regular subscription. In the prototype trial, those with the account details outside the primary user’s house have been required to log in with an additional code, which has to be used within 15 minutes of when it’s sent.

These changes follow a tumultuous year for Netflix, where the end of the pandemic TV-watching boom saw the company take a net loss in subscribers for the first time. At the same time, it faced backlash over the cancellations of popular shows such as Warrior Nun and Fate: The Winx Saga, and even unreleased shows such as Grendel, which was canceled partway through filming. The end of 2022 saw big successes for Netflix, however, with unprecedented hits like Wednesday and Glass Onion arriving on the service.

Source: The Hollywood Reporter


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