A report to Bloomberg today has hinted at the fact the upcoming ad-supported subscription tier of Netflix could be as low as $7, and no higher than $9. Announced earlier this year and met with a wave of consumer pushback, the streaming giant plans to roll out this newest tier later this year, with the higher tiers subscribers are currently paying for, surprisingly staying the same price, but with no ads.
Being marketed as a tier ‘for subscribers that want to see them’, Netflix seems to be trying to paint this newest tier as a way to help the fans, rather than as a cash-grab being mirrored by other streaming giants.
An Ad-Related Trend, Not Just From Netflix
At the minute, Prime is one of the few streaming services that advertise between episodes and films, however, it’s purely comprised of trailers and shorts of its other content, not other items, services, and products, as Netflix plans. Co-CEO Reed Hastings had this to say on the controversial change.
“Those who have followed Netflix know that I have been against the complexity of advertising, and a big fan of the simplicity of subscription, but as much as I am a fan of that, I am a bigger fan of consumer choice. And allowing consumers who would like to have a lower price, and are advertising-tolerant get what they want, makes a lot of sense. It is pretty clear that it is working for Hulu. Disney is doing it, HBO did it. We don’t have any doubt that it works,”
The Bloomberg report also divulged that at first, Netflix will be starting small, with no more than four minutes of adverts per hour of programming, and it’ll only be before and during the program, not after. Supposedly Netflix’s own original movies will be exempt from the new ads-based plan, as will children’s programming, at least for now.
Disney announced at a similar time that they’ll be implementing a similar idea, except unlike Netflix, subscribers will be looking at paying an extra premium if they don’t want to see ads, another contentious move. Their ads-based tier has been confirmed to cost $7.99, whilst the no ads subscription is being bumped up to $10.99. The chairman of Disney Media & Entertainment Distribution said:
“With our new ad-supported Disney+ offering and an expanded lineup of plans across our entire streaming portfolio, we will be providing greater consumer choice at a variety of price points to cater to the diverse needs of our viewers and appeal to an even broader audience. Expanding access to Disney+ to a broader audience at a lower price point is a win for everyone – consumers, advertisers, and our storytellers.”
How this new tier is a ‘lower price point’ when it’s the same price as the current no-ads-based tier is a brave viewpoint to take up, but judging by the response to both this and the Netflix news, it may come to be that we end up going back to the very cable services the streaming giants afforded us to leave.
Source: Bloomberg
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