Popular streaming giant Netflix is planning to offer cheaper, ad-supported plans to users over the next year or two as the company aims to boost its subscriber base amid tough competition from rival platforms.
As per Mashable, Netflix has for the first time in over a decade reported a loss of subscribers. The company cited growing competition from other streaming launches by traditional entertainment companies, as well as password sharing, inflation and the ongoing Russian invasion of Ukraine for the recent loss of paid subscriptions.
According to the company's report to its shareholders, Netflix lost 200,000 subscribers globally and could lose more than 2 million subscriptions in the next quarter.
In an effort to lure more subscribers, Netflix is planning to introduce ad-supported plans to give customers more choice, the company's co-chief executive Reed Hastings said on the earnings call, reported Variety.
The company is expecting to nail down its ad-supported streaming strategy over the next year or two, Hastings said, "but think of us as quite open to us offering even lower prices with advertising as a consumer choice."
Hastings added, "Those that have followed Netflix know that I've been against the complexity of advertising and a big fan of the simplicity of subscription. 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 further said, "I don't think we have a lot of doubt that [the ad model] works. I'm sure we'll just get in and figure it out -- as opposed to test it and maybe do it or not do it."
However, Hastings didn't provide details on what Netflix's ad-supported plans might cost.
Last month, Netflix CFO Spencer Neumann signalled the streaming platform's willingness to consider adopting an ad-supported tier.
"It's not like we have religion against advertising, to be clear," Neumann said at a Morgan Stanley investment conference. While "that's not something that's in our plans right now," he said, "never say never."
In December, Netflix introduced its most affordable monthly pricing plan to date in India, where individuals can subscribe to Netflix for as low as Rs 199. The company said it is "seeing nice growth" in a variety of markets including India.
Introducing ad-supported streaming plans for the users could give Netflix a new pathway to growth.
( With inputs from ANI )
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