Netflix is planning to offer a lower-priced ad-supported tier that might not show ads with certain original content and children's programming.
early next year. These lower-priced plans will undoubtedly lop off some of the features received by those who pay for a full-priced subscription to the video streamer. One such feature that might not be found on the ad-supported tier is the ability to download content to view when offline.Bloomberg
It isn't clear how long a new original movie will show without ads, but Netflix could be doing this so that filmmakers don't get worried about ads interfering with the enjoyment of their films. In addition, some of Netflix's original programming for children also will run without ads even on the ad-supported tier, something Disney+ also plans to do on its ad-supported tier.
During the company's first-quarter earnings, it reported a decline in subscribers for the first time in over 10 years. Netflix blamed the decline in subscribers, which amounted to 200,000 users, on a variety of reasons including password sharing, increased competition, inflation, and the Russian invasion of Ukraine. Netflix shares declined 25% the day after the earnings were released and the stock has yet to fully recover the amount it lost after Netflix reported Q1 earnings.
Analysts estimate that Netflix could garner as much as $3 billion to $4 billion a year with an ad-supported online tier, making it instantly one of the biggest players in online video advertisements. Perhaps it is too obvious to say, but we should point out anyway that the the ad-supported tier will have a lower subscription price than the current service.
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