A subscription with advertising and paid account sharing at Netflix

For the first time in over a decade, Netflix has lost subscribers. And that should not work out, since the streaming platform expects even greater losses in the coming months. To find colors and customers, the service released a carrot, and a stick.

To regain the favor of customers who no doubt find that the recent rises in subscription prices were a little heavy coffee (€ 17.99 for the 4K formula in France), the company drew a secret weapon during the presentation conference of its results.

Netflix loses subscribers and blames account sharing

And this martingale is none other than… advertising. Reed Hastings, the co-CEO of Netflix who has always resisted publicity, has exchange his rifle. From now on, ” it makes a lot of sense to provide consumers with a more affordable, ad-supported option. ” Long-time Netflix followers know that I’ve always been against ad complexity, and a big fan of subscription simplicity. “, he explained. He pursues :

“But even though I’m a big fan [de cette simplicité], I’m even more of a fan of consumer choice. And allowing consumers who would like a lower price and have a tolerance for advertising to get what they want makes a lot of sense.”

This new offer will not be marketed for a year or two, however indicated Hastings who did not give more details. Will the ads be visible before the program? Will there be cuts during the film or the episode? Will these subscribers have access to the entire catalog? How many screens and what quality? And at what price? Even if the announcement may look like a surprise, in fact a formula with advertising seemed to be under consideration for a while.

Netflix says no to ads, for now

Since there is no question of lowering the prices of existing formulas, and since the basic subscription is really content with the bare minimum (difficult to do less…), Netflix therefore has no other choice than the advertisement. In doing so, the service will join Disney+, which announced a similar offer in March.

In the United States and Canada, where subscription prices increased at the start of the year, Netflix lost 600,000 subscribers during the first quarter due to this increase.

So much for the carrot. The stick is for account sharing between friends, a practice prohibited by the terms of use from Netflix, but very popular as everyone knows. The service estimates that there are 100 million households that are improperly taking advantage of its programs as a result, including 30 million in the United States and Canada.

This will pass by the generalization of the experiment carried out in a few countries since last month. Standard and Premium subscribers from Chile, Peru and Costa Rica are offered the addition of additional accounts for people who do not live in the same household. Each of these special accounts has its own profile, recommendations, history, personal list of content, as well as its own username and password.

Netflix wants to charge for account sharing outside the home

The whole thing is charged around €3 more per additional pipe head, and that’s of course for the main account manager’s apple. These tests will be extended to other countries, including the United States, within a year. It is a question of finding the right balance concerning the price which will most certainly be modulated according to the markets (in other words, it should cost more in Europe).