Netflix Ad-Supported Plans Won’t Have All Netflix’s Content
Netflix used to be the undisputed king of streaming video content, but the company has reported subscriber losses for the first time ever in the last two quarters. One of the ways Netflix hopes to turn things around is with a new ad-supported tier. However, the ads won’t be the only difference. Netflix now confirms that its upcoming base plan won’t even have access to all the service’s content.
This bombshell came during Netflix’s recent Q2 earnings call, during which it talked about the loss of 1.3 million subscribers in the quarter. The comment almost flew under the radar, but The Verge points out an exchange that took place at just shy of 19 minutes in the earnings interview video.
You can hear it all for yourself in the video below, but the gist is that just because Netflix offers a TV show or movie in the current plans, that doesn’t mean it will be available in the ad-supported tier. Netflix CEO Ted Sarandos says that if the product launched today, he believes customers would have a good experience as the “vast majority” of Netflix’s catalog is already locked down. However, they would miss out on some things. While Netflix plans to work with studios to get more options on the upcoming basic plan, it won’t be able to get everything.
The company has disabled embedding of its conference call, but you can catch the relevant section of it here.
In the past few years, numerous content owners like NBC, Paramount, and Disney have launched their own streaming services to compete with Netflix. Naturally, that meant a lot of popular content like The Office, Star Trek, and Marvel movies migrated to their respective first-party services. As a result, Netflix doesn’t have the same powerful negotiating position it once had.
We don’t know how many deals Netflix will be able to nail down before the ad-supported tier launches in early 2023, but first-party content like Stranger Things and Squid Game will almost certainly be at the forefront. Recent reports suggest that Netflix is exploring a deal with Microsoft to sponsor the entry-level subscription. There’s a lot of snark about Netflix implementing ads after saying for years it would never do that, but the existence of a new, cheaper plan won’t hurt those who pay for the multi-screen and 4K plans. Netflix’s experiments with monetizing password sharing, on the other hand, will irk everyone equally.
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