While this new plan is expected to raise Netflix subscribers, reports suggested the other way – where the subscribers of Netflix’s high-end plans are migrating to Basic with Ads tier, providing no profit for the company. Also, the new plan is off to a slow start, gaining only a few subscribers since the last month.
Netflix Basic With Ads Tier
Observing the fall of revenue and migrating subscribers, Netflix was forced to launch a new plan with ads for a slightly lower price – called the Basic with Ads tier, last month. Costing $6.99 a month, this plan is severely restricted in terms of features. For one, it has access to only some parts of the Netflix library due to licensing agreements, and no download option for offline viewing, and contains 4-5 ads in a one-hour program. May all these seem troubling, as the plan is off to a rough start – says Antenna. Documenting the numbers based on millions of raw transactions like online purchases and credit and banking data, Antenna says that Netflix’s Basic with Ads tier has made up 9% of Netflix’s total subscriber count since its inception in the US. Further, the report says that 0.1% of existing Netflix subscribers switched from other plans to Basic with Ads tier. While this is expected to bring in more revenue and subscribers, Antenna says that people have been migrating from Premium and Standard plans to Basic and Basic with Ads tiers since the last quarter. As it notes, about 29% of Netflix subscribers were signed up for the Premium service, 31% were members of the Standard tier, and 40% were subscribers to the Basic plan. Well, this report was quashed by Netflix, which said to the Wall Street Journal, “[it’s] still very early days for our ad-supported tier, and we’re pleased with its launch and engagement, as well as the eagerness of advertisers to partner with Netflix.”
