Netflix’s recent woes have been in the news for weeks, and in an effort to protect subscribers after a staggering 200,000 net loss in the first quarter of 2022 – the company’s biggest dip in a decade – the streaming giant is adjusting its strategy out of necessity. .
Part of Netflix’s switchover includes a crackdown on password sharing, and now, despite previous comments to the contrary, the introduction of ads on the platform, which will roll out sooner than expected, according to a new report in The New York Times†
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According to two anonymous company sources, an internal note from executives stated that the company plans to introduce an ad tier in the last three months of 2022; it will also end password sharing around the same time. The note called out streaming competitors, such as Hulu and HBO, who have successfully integrated advertising without sacrificing the strength of their brands.
The plans mark a change of course for the company. In March, Netflix CFO Spencer Neumann told a crowd at Morgan Stanley’s Technology, Media and Telecom Conference in San Francisco that the company is unlikely to follow in Disney’s unpopular footsteps and start advertising. “It’s not like we have religion against advertising, to be clear. We’re leaning on the consumer experience, consumer choice and what’s great for our creators and storytellers. [Advertising is] not something that’s in our plans at the moment,” he said.
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In another effort to make up for lost revenue and subscribers, the streaming giant increased subscription rates in January, raising standard plans in the US and Canada from $13.99 to $15.49 and premium plans from $17.99 to $15.99. $19.99.
As the streaming landscape becomes increasingly crowded, it remains to be seen how much Netflix will have to transform its original model to remain relevant and competitive.
The company is down nearly 50% month over month.
