news Netflix ad-supported tier has 70 million monthly users two years after launch

[Cpvr]

Netflix’s lower-priced, ad-supported tier has reached 70 million active monthly users worldwide, two years after its launch. The company shared on Tuesday that more than half of new subscribers in regions with the ad-supported option are opting for it. Netflix expressed optimism, noting “positive momentum and growth” across all aspects of the business and “steady progress” in membership growth across countries.





Introduced in November 2022, the ad-supported tier was Netflix’s response to a slowing rate of new subscribers. However, subscriber growth has recently rebounded; last month, Netflix reported adding 5.1 million new members in the third quarter, surpassing Wall Street’s expectations. Currently, Netflix boasts 282.7 million subscribers across its pricing options. Beginning next year, Netflix will no longer report subscriber numbers to investors, focusing instead on revenue and other financial performance metrics.





When Netflix initially launched its ad-supported service, it partnered with Nielsen for content ratings. In May, Netflix announced a three-year deal to broadcast two National Football League games on Christmas Day this year, with all ad inventory for these live games now sold out. Netflix also confirmed that FanDuel and Verizon will advertise during these games, with FanDuel serving as the exclusive pregame sportsbook betting partner.





Many media companies are adopting ad-supported models to attract subscribers with lower-cost plans while generating additional advertising revenue to move closer to profitability. While traditional TV ad revenues have slowed, digital and streaming platforms have experienced ad growth.


In May, Netflix last reported on the growth of its ad-supported tier, which then reached 40 million active monthly users—double the figure shared in January. Also in May, Netflix announced plans to launch its own ad platform, ending its reliance on Microsoft technology. This platform is already live in Canada and is set to expand to the U.S. by mid-2024, with a global rollout targeted for the end of 2025.

Source: https://www.cnbc.com/2024/11/12/netflix-ad-supported-tier-70-million-monthly-users.html

 

[Alamson]

Ad revenue is a major way to sustain the business because ad-free subscription sales may be volatile. The growth in the low priced ad-supported tier shows that users value affordability. But the number may drop if the ads become too intrusive and affect content quality. In addition, other streaming platforms may copy this strategy which may be a threat to Netflix in the long run. Netflix must continue to be innovative. It cannot afford to rest on its laurels.

 

[Reelz]

This is impressive! But it shouldn't come as a surprise because Netflix is probably a leading streaming platform in the world. 70 million monthly users is a staggering figure in just two years. It shows that a lot of users are seeking affordable streaming options.

 

[ActionAce]

This is common sense. Personally, I don't always go for stuff I would pay for if I can get it for free with just some little ads popping up. I’m fine with the ads once I can gain access to all the features I need. This is the concept used by Netflix and look at the success of that campaign. Don't be surprised that they might even make more money than usual the subscription based concept.

 

[MidnightMuse]

I do not like an ad-supported service that I have to pay for, but I get it and can see both sides of things.

On one side, Netflix has to pay for its offerings, servers, and other expenses somehow while keeping costs affordable, and on the other people want to get an ad-free experience if they are paying.

 

[Yama]

The money we are spending on entertainment is always going up, we are never satisfied with just one streaming service, we subscribe to multiple services. On top of that we spend money on cable TV, game, and even go to movies. Therefore, I always look forward to cut cost. I do not mind watching ads if the price is reduced.