Netflix has long denied interest in offering members an ad-supported plan, but that might change coon. Hulu has offered a similar plan for several years now and Disney+ announced just a few weeks ago that they plan to do the same. Netflix CEO Reed Hastings has now said that the streaming giant is “quite open” to offering an ad-supported business model.
In a Q1 2022 earnings interview, the Netflix CEO said, “Those who have followed Netflix have known that I’m against the complexity of advertising and I’m a big fan of the simplicity of subscriptions.” Adding, “But as much as I’m a fan of that, I’m 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.”
Hastings continued, “So that’s something we’re looking at now, we’re trying to figure it out over the next year or two, but think of us as quite open to offering even lower prices with advertising as a consumer choice.” The CEO’s remarks come after Netflix reported losing 200,000 subscribers in a recent earnings update. This has led to the coming cracking down on shared accounts.
The Netflix CEO went on to say, “It’s not a short-term fix because once you start offering a lower price plan with ads as an option, some consumers take it, and we’ve got a big install base that probably are quite happy where they are. So think of it as, it would phase in over a couple of years in terms of being material volume.”
It looks like the streaming giant is looking into all of its options going forward. The introduction and popularity of competitors such as Disney+ and HBO Max, as well as others, have significantly changed the landscape of streaming. Netflix now needs to offer consumers exactly what they want because if they don’t, other companies will.