Saturday, July 2, 2022

Netflix’s ad-supported subscription and password-sharing charges may arrive this year

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While Netflix had long said its service would not feature ads, it revealed last month that it will actually be rolled out. Co-CEO Reed Hastings said during an earnings call that plans for that level would be confirmed “in the next two years.” However, it looks like the company wants to offer the option even sooner. It reportedly suggested in an internal memo that an ad-supported version of the streaming service will be released later this year.

Executives told staff in the note that they plan to introduce an ad-supported plan in the last three months of 2022, according to † In addition, the note suggested that the level will be introduced around the same time as an additional fee for subscribers who share their passwords with people living at different addresses.

In the memo, Netflix is ​​said to have noted that, outside of Apple TV+, every major streaming platform offers a cheaper, ad-supported subscription. Those include Hulu, HBO Max, and Peacock. The company reportedly said some of its competitors are still able to “maintain strong brands” while running commercials.

Meanwhile, Netflix recently said that more than 222 million households are paid subscribers. However, it claimed that more than 100 million households watch Netflix on someone else’s account without paying for access. During the earnings call, Chief Operating Officer Greg Peters said that while the company “isn’t trying to stop that sharing,” it “will ask you to pay a little more to be able to share.” Netflix will pay an additional fee for account sharers in Peru, Chile and Costa Rica in March.

After years of impressive growth, Netflix suddenly has a big problem when it comes to subscriber numbers that last quarter. It lost 200,000 members (largely due to in Russia) and it thinks it could lose another two million this quarter. With its share price down more than 50 percent in the past month, the company hopes an ad-supported tier and additional costs for password-sharing will help boost revenue.

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