Thursday, February 2

Is Netflix adding ads? How the potential change could affect consumers


Coming soon to your Netflix account: ads.

During its quarterly earnings report, where it revealed its first drop in global subscribers in a decade, Netflix said it is exploring plans that include ads for a lower price.

In a call with investors, Netflix co-founder and CEO Reed Hastings said he has been against “the complexity of advertising,” preferring the simplicity of a subscription.

“But as much I’m a fan of that, I’m a bigger fan of consumer choice,” Hastings said. “And allowing consumers who would like to have a lower price and are advertising-tolerant (to) get what they want makes a lot of sense.”

Although Hastings said an ad-supported plan is still a year or two away, it’s a moment Netflix subscribers might potentially dread. One of the biggest appeals of Netflix is ​​watching their favorite TV shows or movies without a single commercial interruption.

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However, more consumers appear comfortable mixing ads with their streaming, so long as it’s affordable. A December survey from Forrester found 44% of US online adults who use a streaming service will put up with ads if it means they pay less.

“Ultimately consumers will follow the content and the overall value they’re getting when choosing which streaming services make their watch list,” said Forrester VP and Research Director Mike Proulx.




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