Netflix doesn’t rule out having free products with more ads

In delivering financial results for the last quarter of 2022, Netflix announced that it does not rule out the possibility of free TV with advertising in its plans, a trend known as FAST.

Ted SarandosThe co-CEO assured that the company is “paying attention” to what is happening with this modality, which many other platforms are already adapting as an option to get closer to traditional TV, but retain the essence of streaming and on-demand content.

“We’re open to all the models that exist today, but we have a lot of work ahead of us this year, both with the payment distribution and with the launch of ads and continuing the content board that we’re trying to offer.” Our members. Therefore, we are not losing this segment,” said the manager.

Considering the way of working netflix, It is normal that this idea will not take off in the short term, because they usually delay entering the market trends, as it happened Advertising formats.

In addition, as Sarandos comments, the focus the company wants in early 2023 is to end the practice. Sharing accounts Some customers, which affects the company’s revenue and which they intend to address soon, although there is no concrete plan yet as to how they intend to do so.

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Ad supported netflix

In late 2022, a cheaper plan with platform advertising was launched. An option that allowed them to earn more revenue and provide customers with a lower subscription price.

Advertising is a large source of revenue for the company; In fact, for the first quarter of 2023, they estimate the revenue in this matter to be $8,170 million. However, the economic plan still does not give the expected results.

According to Kantar Although the company is pleased with what has been achieved in these first months with ad-supported subscription, to date this modality represents 12% of the total subscriber base, and Netflix has planned a wider range.

However, it is important to note that the ad-supported plan is currently only available United States, Great Britain, France, Germany, Spain, Italy, Australia, Japan, Korea, Brazil, Canada and Mexico.

“We wouldn’t get into a business like this if we didn’t believe it could be at least 10% more of our revenue, and hopefully much more in the mix over time as we grow,” said the CFO. Spencer Neumannin the report.

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In the presented report, the company recorded an increase in the customer base. Going from 223.09 million global subscribers to 230 million in the last four months of last year, an increase of 7.7 million people.

Although they admitted that “2022 was a tough year”, given that the platform lost more than a million users worldwide in two quarters.

“We believe we have a clear path to accelerate revenue growth: to continue to improve all aspects.” NetflixLaunch paid sharing and build our advertising offering,” the company added in a filing.

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