Netflix debut subscription with ads

Netflix debut subscription with ads

Netflix said the ad-supported subscription option will debut in November across twelve countries.

Netflix said the ad-supported subscription option will debut in November across a dozen countries as the streaming service strives to spur stunted growth.

Netflix reported a loss of 970,000 subscribers in the second quarter along with stagnating earnings, and its share price is down 63 percent from this time last year despite a slight uptick in ad tier news.

Greg Peters, chief operating officer of Netflix, said at a press briefing that new “Basic with Ads” subscriptions will be $6.99 in the US — $3 less than the basic no-ads option.

“The timing is great because we’re really at this pivotal moment in the entertainment industry and the evolution of that industry,” Peters said.

“Broadcasting has now surpassed both broadcast and cable for total television time in the United States.”

The discounted ad category, a first for Netflix, will roll out in Australia, Brazil, Britain, Canada, France, Germany, Italy, Japan, South Korea, Mexico, Spain and the United States.

Video ads range in length from 15 seconds to 30 seconds.

“We’re looking to load a very light ad of no more than four to five minutes of ads per hour, including some limits on impressions so members don’t see the same ad over and over,” Peters said.

Having eschewed ads since it launched the streaming service, Netflix has acquiesced as competition in the market intensifies and consumers retreat from soaring inflation.

With the launch of cheaper and ad-supported subscriptions, Netflix and Disney are expected to nibble the revenues of traditional TV channels.

Netflix rival Disney is expected to launch its ad-supported subscription soon.

“These launches will create the largest premium ad space in more than a generation,” said Dallas Lawrence, Vice President of Analytics, Samba TV.

“It will be an important moment for advertisers.” Avoid Politics – Netflix has sold out nearly all of the ad space to launch the new category, global advertising head Jeremy Gorman said during the briefing.

The executives said that advertisers would be able to target audiences based on factors such as the country they live in as well as showcase successful genres or shows to be part of the platform’s “zeitgeist moments.”

Gorman added that Netflix will not take political ads and will not accept marketing that promotes smoking, firearms, fireworks “or anything that appears to be a get-rich-quick scheme”.

Executives said advertisers will have options to avoid sexual displays, nudity or graphic violence, and Netflix is ​​partnering with Neilson and ad traffic verification companies to provide data on the reach of messages to audiences.

“The new ad-supported tier will help the player stem the hemorrhage of total subscribers, but it will pull most users out of the company’s existing user base rather than expand the Netflix viewership group,” said Peter Neumann, predictive analyst Insider Intelligence. .

Peters acknowledged the potential for Netflix subscribers to switch to the lower-priced offering, but said the company expects this to be offset by ad revenue as well as the overall increase in subscribers.

“We’re not trying to direct people to one plan or the other,” Peters said. “We really want to take a pro-consumer approach and let them figure out which plan is right for them.”

“We think the revenue model will be fine as a result.”

Netflix continues to invest in shows that it believes will attract and retain subscribers.

Peters noted hits like “Stranger Things” and “Extraordinary Attorney Woo” and pending releases of highly-anticipated films like “Glass Onion: A Knives Out Mystery.”

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