After once saying ads wouldn’t appear, it seems Netflix is changing their approach. The company plans to offer ad-supported subscription options to offset the current pricing structure, according to The Hollywood Reporter.
On a company call Tuesday, Co-CEO Reed Hastings stated that the streaming giant will take another approach to offer services. He stated:
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.
Stating the new plan will be similar to Hulu, Hastings also noted how well the ad-supported plans worked for their competitors.
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.
This comes just days after Netflix announced they lost 200,000 subscribers during the first quarter of 2022, which was the first decline in 10 years.Netflix shares also plummeted by 30% and the drop in share price contributed to the loss of more than $40 million of the company’s market cap.
The company stated there were several factors that contributed to their loss, including households sharing passwords. They told shareholders that 100 million households share passwords, which “means it’s harder to grow membership in many markets.”
Roomies, what do you think about this?
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