Competitor Disney+, which already has a free-ad-based plan, is now intending to offer a similar ad-supported plan starting at $7.99 (about Rs 639) in the US on December 8. Netflix clarified that it is targeting only a few markets initially with significant advertising spend in countries like the US, UK, Canada, France, and Germany. Netflix is driven to release the cheaper ad-supported plan gradually across the globe as it wants to observe consumer’s reactions. There is currently no information regarding its launch in India.
How will the cheaper ad-supported plan work?
The cheap Netflix plan is reported to cost somewhere between $7 (about Rs 560) and $9 (about Rs 720) monthly against the Standard plan costing $15.49 (about Rs. 1,237) for the US audiences. The Standard plan offers two screens at a time with 1080p video streaming. What the cheaper ad-supported plan is expected to bring to the table has still not been disclosed by Netflix yet, although it had been reported previously that the cheaper ad plan will not allow users to download and watch content offline.
As per reports, Netflix will run ads for about four minutes per hour for series. For movies, however, it is reported to roll out pre-ads. A Netflix representative told Variety that the company is still in the initial days of determining “how to launch a lower-priced, ad-supported tier and no decisions have been made.”
Netflix recently announced Microsoft as its partner for technology and sales for the ad-supported plan. In April this year, Netflix disclosed its loss of subscribers for the first time in a decade post which, co-CEO Reed Hastings stated that Netflix had been planning to have a cheaper ad-supported plan. For the streaming service which has been ad-free for decades, this came as a rather massive change.
Other than the cheaper plan, Netflix is also determined to start charging its users for password-sharing. In this, multiple users can club together to purchase a single overall Netflix plan, share the user ID and password amongst each other, and then pay their equal share accordingly. Unregulated password sharing had been affecting Netflix’s subscriber count for a long time.