Tech

Cheap ad-supported Netflix subscription could have a serious problem

Yesterday we saw that Netflix had already confirmed that it will start charging for account sharing in some countries, and today we have some more information about the expected cheap subscription with advertising, one of the company’s most important novelties for stop the “bleeding” of users that has been suffering, and to attract a wider audience.

Regarding the loss of users, it is necessary to see concrete data to better understand the reality that Netflix is ​​going through. The company has been experiencing a considerable loss of users, a situation that has been aggravated by the end of the service in Russia, where it lost around 700,000 subscribers, a figure to which we should add the potential growth that it gave up when leaving said market. In the second quarter of 2022, it has confirmed the loss of 970,000 subscribers.

There is no doubt that the data is not good, but Netflix clings to the consolation that the numbers are not as bad as expected. In general, I think that this new economic plan with advertising is mainly aimed at young people with few resourcesand also to those users who enjoy Netflix on a more occasional basis and that, therefore, it is more profitable for them to spend less money and accept advertising.

The fact is that said plan seems to be going through a complicated situation, since Netflix would be forced to renegotiate agreements that it had signed with important studios and publishers to be able to include certain contents in the economic plan with advertising. According to the Co-CEO and chief content officer of Netflix, Ted Sarandos, if this plan were launched today some content would not be availableand those agreements are to blame.

According to Sarandos, they can include what most people watch on Netflix right now, but it is clear that launching a cheap ad-supported plan that lacks important content would be a serious mistake, since it would create a “decaffeinated” subscription that could not end up attracting a large amount of public.

It is important that you bear in mind that this would not affect the exclusive content of Netflix, obviously this would be available, but it could leave out third-party series that enjoy great popularity, such as Breaking Bad or The Walking Dead. We will see how the situation evolves, but I think that in the end Netflix will wait to renegotiate those agreements to be able to include all the content before launching the economic plan with advertising.

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