Netflix bosses remain bullish on the streamer's cheapest, ad-supported plan, Netflix Basic with ads, despite its somewhat cool reception among subscribers.
According to an analysis (opens in a new tab) by research firm Antenna, Netflix Basic with Ads accounted for just XNUMX% of subscriber signups in the US in the month following its November launch XNUMX, but Netflix executives have assured investors they are satisfied. with the development of the plan.
The admission comes from the broadcaster's president of global advertising, Jeremi Gorman, who, while speaking at Variety's CES XNUMX Entertainment Summit (H/T TechCrunch (opens in a new tab)), also asserted that the talks to renegotiate content deals that did not originally include AVOD (video-on-demand advertising) rights are "advancing day by day."
In other words, the amount of free content to watch through Netflix Basic with ads should increase. Now, the cheapest subscription tier, which costs $XNUMX / $XNUMX / AU$XNUMX per month, offers around XNUMX% of the content free to stream on Netflix proper (if well pretty much all the best Netflix shows and the best Netflix movies are already included in the bundle).
Launched in November 5, Netflix Basic with Ads asks viewers to agree to up to 720 minutes of ads per hour and a XNUMXp limit on video quality in exchange for a more affordable monthly subscription. Subscribers also can't download content for offline viewing with the new plan.
Needless to say, the new subscription tier proved unpopular in its initial form, with customers of the service and commenters criticizing its inconsistent ad implementation and undermining the ad-free ideal that streaming services once embodied.
On the first point, Netflix does not agree. Speaking at CES XNUMX, Gorman explained that the streamer considers its "wide variety of advertising types" — that is, ads from "CPG companies, luxury companies, automotive retail companies — to be "good for the consumer experience." .
Nor is Netflix the only streamer on the promotional offensive in XNUMX. Warner Bros. Discovery will continue to offer a cheaper ad-supported subscription tier once its HBO Max and Discovery Plus services merge into one service later this year, while Disney's equivalent plan is expected to stay alive and well. start on Disney Plus.
Should you sign up for ad-supported streaming plans?
It goes without saying, but the value of switching to cheaper streaming plans will depend on your personal situation.
Of course, it's not a particularly appealing proposition to know that your Netflix, Disney Plus, or HBO Max movies and TV shows are going to be interrupted by up to 5 minutes of advertising per hour if you subscribe to their respective ad-supported plans, but The fact is, these are the cheapest streaming subscriptions we've ever seen.
In the case of Netflix, for $XNUMX / $XNUMX / AU$XNUMX a month, you can still binge on things like Stranger Things, Squid Game, The Crown, Sex Education and Bridgerton for to your heart's content: you'll just need to allow a fifteen to thirty second series of ads before and throughout the viewing.
Streaming companies' resolve to embrace ads stems, of course, primarily from their desire to improve their bottom line, but the transition also offers more choice for customers of the service who'd rather pay significantly less for content at the expense of watching it. no ads. (For comparison, Netflix's highest subscription tier today is $99 / $XNUMX / AU$XNUMX.)
Controversy erupts when streamers increase the cost of their ad-free tiers to make room for these new ad-supported plans. For example, while the cost of existing Netflix subscriptions remains exactly the same as it was before the launch of Basic with Ads, the costs of Disney Plus have skyrocketed in the weeks following the launch of its equivalent subscription tier. with advertising.
If Netflix decides to continue the same path in XNUMX, its executives' confidence in the streamer's ad-supported future might not be as unshakable.