Netflix is adding a cheaper plan for those who want a lower price and will watch ads

Jun 27, 2022Updated Jun 4, 20251 min read

During an interview at the Cannes Lion advertising festival, the CEO of Netflix Ted Sarandos gave the most direct indication that it will launch a cheaper, ad-supported subscription tier to the embattled streaming service.

In essence, Mr. Sarandos said that the company will be “adding an ad tier; we’re not adding ads to Netflix as you know it today.” After the pandemic boost wore out, Netflix hit the skids in terms of subscriber count as people spent less time watching TV shows and movies.

At the same time, new streaming services from juggernauts like HBO, Disney, or Apple, grew to rival Netflix, all the while it kept spending borrowed billions on content creation. Well, that crazy content spending was curtailed, a lot of shows were cancelled, and now Netflix will try and boost subscriber numbers by going downmarket.

Currently, the Netflix plans start from the Basic one at $9.99 per month with SD (up to 480p) picture quality, followed by the Standard $15.49 a month plan that offers 1080p definition, and go up to the Premium Netflix tier at $19.99 per month which includes 4K UHD quality streaming on up to four devices.

Besides cracking down on password sharing, Netflix will likely introduce the new ad-supported subscription tier at something close to the Apple TV+ $4.99 subscription price and will try to recuperate the difference with ad revenue. Or, as Ted Sarandos eloquently puts it:

We’ve left a big customer segment off the table, which is people who say: ‘Hey, Netflix is too expensive for me and I don’t mind advertising,’ We adding an ad tier; we’re not adding ads to Netflix as you know

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Mei Ling Tan

Contributor · RetailNews.asia

Mei Ling Tan is the Editor of Retail News Asia, where she leads the editorial team in delivering in-depth coverage of Asia’s dynamic retail landscape. With over a decade of experience in business journalism, Mei Ling is known for her sharp analysis, deep industry insights, and commitment to uncovering the stories behind Asia’s most innovative retail brands. Before joining Retail News Asia, Mei Ling held senior reporting roles at regional business publications, covering everything from consumer trends to digital transformation in retail. A graduate of the National University of Singapore with a degree in Communications and New Media, she combines journalistic integrity with a strong understanding of evolving market forces. Outside the newsroom, Mei Ling is a frequent speaker at industry panels and a mentor for young journalists.

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