For as long as Netflix has been in the streaming game, there’s been one consistent aspect of all the platform’s plans: no commercials. No matter which Netflix subscription plans people choose, they’re all guaranteed not to have whatever movie or TV show they’re watching be interrupted by advertisements. Well, that era is coming to a close, as Netflix is putting together plans for some subscribers to be able to choose cheaper, ad-supported plans, and Netflix CEO Reed Hastings explained why this is happening.
This big update was revealed in the Netflix Q1 2022 earnings call today, and the streaming service will examine what those ad-supported plans will look like “over the year or two.” Netflix COO Greg Peters described including advertising as “an exciting opportunity” for the company, and Reed Hastings said the following about this change of course:
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.
This Netflix update comes a week after Disney confirmed it would launch an ad-supported tier for Disney+, while HBO Max rolled out its commercial-filled plan back in May 2021. Hulu, Peacock and Paramount+ are among the other streaming services that are available with commercials, so now Netflix will be joining them, although it doesn’t sound like these cheaper ad plans will become available for at least a year, if not longer. However, Reed Hastings clarified that unlike with Netflix’s streaming competitors, the company would launch its ad-supported plans without any data tracking or ad-matching. He explained:
In terms of the profit potential, definitely the online ad market has advanced, and now you don’t have to incorporate all the information about people that you used to. We can stay out of that, and really be focused on our members, creating that great experience.
As things currently stand, Netflix has three plans subscribers can choose from: the Basic plan, which costs $9.99 a month; the Standard plan, which costs $15.49 a month; and the Premium plan, which costs $19.99 a month. All those plans allow subscribers to watch as much content as they want, but the difference is how many screens can be utilized at a time, how many phones and tablets can download content and whether you’re streaming in SD, HD or Ultra HD. It’s unclear how Netflix’s ad-supported plans will deal with those factors, as well as where they’ll fall on the price spectrum.
When more details about Netflix’s commercial plans are revealed to the public, we’ll pass them along. For now, those of you already subscribed to the service should see if there are any new Netflix movies or Netflix shows that catch your eye.
