Netflix to add ad-supported plans as subscribers decline

Netflix has had a rough time in the last quarter, which could be a nuisance. The popular video streaming platform recorded a loss of 200,000 subscribers in the first quarter of 2022, the first loss for Netflix in a decade. To protect its user base from further decline, Netflix is ​​open to the idea of ​​ad-supported subscription plans and also plans to curb password sharing. Let’s take a look at the details here.

Netflix’s plan to manage a declining user base

Netflix revealed in its latest Q1 earnings report that more than 100 million users share a Netflix account, and the password sharing issue is one of the reasons for the decline in its user base . To solve this, Netflix plans to roll out its recent tests in earnest soon.

If you’re interested in continuing, this test introduced an add-on option that allows you to add users to your subscription for an additional fee. The feature is currently targeted at users in Chile, Costa Rica, and Peru, and takes into account that people who use Netflix for free aren’t actually subscribers, and is a sign that Netflix is ​​cracking down on password sharing to increase its subscriber base. It is a means. This feature will be rolled out to more markets within a year.

In the report, Netflix said: So even though we can’t monetize everything right now, we think this is a big opportunity in the short to medium term. “

Another way Netflix aims to solve its subscriber attrition problem is by soon introducing cheaper ad-supported plans . OTT platforms had no intention of introducing advertising on their streaming platforms, but now they seem to be attracted to the idea to get more subscribers and revenue.

In a recent video interview , Netflix CEO Reed Hastings said, ” Those of you who follow Netflix know that I am an opponent of the complexity of advertising and a big fan of the simplicity of subscriptions.” said. “But as much as I’m a fan of that, I’m also a bigger fan of consumer choice. Enabling consumers who want lower prices and are open to advertising to get what they want is extremely important. It makes sense.

However, it is unclear when these ad-supported plans will be introduced or how much they will cost.

Netflix has other reasons for its declining user base. It blames “the proliferation of connected TVs,” competition from Disney+ and Amazon, data costs, the Russia-Ukraine war, rising inflation, and, in part, COVID-19. And one thing the company doesn’t realize is that despite the competition, prices are going up.

The company plans to solve this problem with the steps mentioned above, while focusing on better content (of course). Still, the video streaming platform expects to lose about 2 million subscribers in the second quarter of 2022. It remains to be seen how well this situation will be managed in the coming months. What do you think about Netflix losing subscribers? Do you think it’s losing its appeal? Please share your thoughts in the comments section below.