FP employees14 Oct 2022 13:51:38 IST
Netflix has announced that they will launch their ad-supported subscription tier on November 3rd. The ad-supported tier, called Basic with Ads, will be launched first in the United States. Countries where Netflix plan prices are higher, such as Australia, Brazil, Canada, France, Germany, Italy, Japan, Korea, Mexico, Spain, and the UK, will receive the new Basic with Ads plan at a later date. It is not yet clear when this plan will be implemented in India.
For the international market this is new plan will not impact Netflix’s other plans. The new “Basic with Ads” plan costs $6.99, or about 600 rupees per month, which is about the same as the premium plan of 649 rupees that we have in India. That new ad-supported level shakes things up quite a bit.
Netflix ad-supported plan features
In Basic with Ads, users get around 4-5 minutes of ads for every hour of content they consume. The provided ads are around 15-30 seconds long and play before and during the actual content. According to Netflix, this model may change at a later date.
Users also have access to a limited content library, but all Netflix originals are available. Users can only stream content on one device at a time, either a TV, a PC, a tablet, or a mobile phone. Users also cannot download titles.
However, the biggest change will be the fact that viewers will only be able to stream content in 720p or HD resolution on this plan.
What kind of advertising is shown?
Netflix will work with agencies to show customers the most relevant ads. For example, the company will work with Nielsen and use their Digital Ad Ratings (DAR) in the US. According to a blog post, “While it’s still very early days, we’re excited about the interest from both consumers and the advertising community – and couldn’t be more excited about what lies ahead.” As we learn from and improve on the experience, we expect to roll out to more countries over time.” They will Partnership with Microsoft and using their services to provide the commercials in their cheaper, ad-supported version
How much could the ad-supported tier cost in India?
So far there is no clear evidence for this. In the US, Netflix plans are pretty expensive, especially when we look at exchange rates. The basic ad-free plan costs $9.99, or about 800 rupees per month. The Standard and Premium plans cost $15.49 or Rs 1,300 and $19.99 or Rs 1,600 per month. Hence it makes sense for Netflix to initially introduce an ad-supported plan in countries where subscription fees are higher than other markets.
In India, the streaming company dropped the price of its December 2021 plans. Currently, the cellular plan costs 149 rupees. The basic, standard and premium plans cost Rs 199, Rs 499 and Rs 649 respectively. The ad-supported plan in the US, which is said to be the cheapest plan, costs almost as much as the most expensive one we have in India. In the event that this new basic plan is brought to India, we’re pretty sure Netflix will have to rebalance its subscription plans to accommodate both the mobile-only viewers and the premium users.