Netflix launches a very lucrative new subscription plan that's cheaper than its main competitors

Netflix will charge $6,99 per month for a new ad-supported plan that the company will launch in the US on November 3rd. The edition told in more detail CNBC.

Photo: IStock

The Netflix Basic with Ads tier includes an average of four to five minutes of commercials every hour and will prevent users from downloading movies and series. A limited number of series and films will initially be unavailable due to licensing restrictions.

Ads are given between 15 or 30 seconds before and during Netflix content. Companies will have the option to opt out of showing ads on content they deem inappropriate. To help advertisers understand reach, ratings firm Nielsen plans to use Digital Ad Ratings' standard digital audience measurement in the US starting in 2023.

Netflix is ​​launching its first less expensive ad-supported plan after years of ditching the concept. The move comes as subscriber growth has stalled in recent quarters. Netflix lost subscribers in the first two quarters of this year and is estimated to have added 1 million customers in the third quarter. The company has around 221 million subscribers worldwide, making it the largest streaming service on the planet.

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According to COO Greg Peters, Netflix will announce its third-quarter earnings a little later and release its forecast for new subscribers and revenue.

The streaming company will have hundreds of advertisers at launch and has almost sold out ad space. Initially, advertising in children's programs and new films is not provided, while in older films it is allowed in the middle of the video.

Prices below Disney+ and HBO Max

Netflix offers a lower price than Disney+ and Hulu for the same ad-supported plans. Disney+ will charge $7,99 per month when it launches its Disney+ Ads subscription plan in December. HBO Max with ads costs $9,99 per month.

Netflix, Peters said, has set the price of the service such that any customer who upgrades to an ad-supported service from a basic ad-free plan will still have a positive impact on the company's revenue.

The company will receive at least $3 per month per user from advertising.

“We want to offer consumers choice and find out what's best for them,” Peters explained.

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The video resolution for the basic plan with Netflix ads will be 720p instead of 1080p. The company's basic ad-free plan costs $9,99 per month and is 720p.

The ad tier will initially be available in Canada and Mexico on November 1st, and in Australia, Brazil, France, Germany, Italy, Japan, Korea, Mexico, the United Kingdom and the United States on November 3rd, and in Spain on November 10th.

Subscription fees for different services

Netflix

• $6,99 - basic with ads
• $9,99 Basic No Ads
• $15,49 Standard no ads

HBO Max

• $9,99 - with ads
• $14,99 - no ads

Hulu

• $7,99 - with ads
• $14,99 - no ads

Paramount +

• $4,99 - with ads
• $9,99 - no ads

Peacock

• $4,99 - with ads
• $9,99 - no ads

Disney +

• $7,99 - with ads
• $10,99 - no ads

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