Netflix may have increased its prices for subscription plans across the board, but they might be open to lowering them again. On one condition.
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According to IGN, the media streaming giant has said it is "quite open" to lowering prices by virtue of an ad-supported subscription plan. That is, people will be paying less every month, but their viewing experience will have ads in them - something so many folks aren't too fond of these days.
This was from a statement by company CEO Reed Hastings, who has said in the past that he's not a big fan of ads himself. During a recently concluded Q1 2022 earnings call, the CEO had this to say:
"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. 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."
This kind of business model isn't entirely new, if you think about. Hulu, one of Netflix's biggest competitors, already offers a cheaper, ad-supported subscription alongside its other ad-free offerings. By allowing advertisements on the platform, Hulu can charge as low as $6.99 a month without any restrictions on the content that people want to watch.
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Compared to current Netflix prices, the cheapest plan stands at $9.99. This makes $6.99 an absolute bargain. As a result, Hulu has been steadily gaining subscribers. According to Digital Trends, the streaming service now has 45.3 million paying subscribers as of January 1st, which is up from 39.4 million subscribers a year ago.
In comparison, the erstwhile streaming giant has been losing people to competitors. Just during Q1 2022, they've already reported a loss of 200,000 subscribers and expects to lose 2 million more. They cite password sharing as one of the main culprits, but perhaps many people digress.
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Why This Could Be A Good (And Bad) Thing For Netflix
Netflix prices getting lowered is a good thing. That's because despite the steady rise of competing streaming platforms, its popularity is still unmatched. Furthermore, people are already not big fans of the recent price hikes - two of which already occurred within a span of around two months. This means that folks still want to keep their Netflix subscriptions as much as they can.
But allowing ads also has its downsides. The most obvious one being the simplest: people just hate them.
Anyone can have their own reason for not liking ads anywhere. That's what Netflix's CEO believes in the first place, and why its ad-free subscription model is popular. However, one of the biggest reasons why ads are universally disliked is that some people feel like they're an invasion of their privacy, writes Wistia.
Ads are targeted to you online because of your personal information and habits. And so many folks believe that this feels like they're being spied on, which makes a bit of sense. They consider it similar to an infringement on their personal space.
Netflix hasn't made a concrete statement regarding this subject. So this is a developing story.
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This article is owned by Tech Times
Written by RJ Pierce
