Netflix, which is suffering from a decrease in the number of members and the stock price is plummeting, aims to introduce an 'advertising low price plan' by the end of 2022
Netflix, a major video streaming service, announced in its first quarter 2022 financial results that the number of paying members has declined for the first time in the last decade. Meanwhile, the New York Times, a major daily newspaper, reported that Netflix plans to introduce an 'advertising low-priced plan' by the end of 2022, aiming to increase the number of members.
Netflix Tells Employees Ads May Come by the End of 2022 --The New York Times
Netflix's ad-supported tier will reportedly roll out sooner than expected | Ars Technica
https://arstechnica.com/information-technology/2022/05/netflix-speeds-up-plan-for-ad-supported-tier-says-it-may-debut-this-year/
Netflix announced that in the first quarter of 2022, the number of paying members worldwide reached 222 million households, and the number of paying members decreased by about 200,000. The last decrease in the number of paying members was in October 2011, and this was the first decrease in the number of paying members in the past 10 years. Netflix also revealed that it will reduce the number of people by 10,000. As a result, Netflix's stock price fell by 35% in one day, and the market capitalization of 70 billion dollars (about 9.1 trillion yen) was blown off in about three weeks after the announcement of financial results.
The number of Netflix members has decreased for the first time in the past 10 years, and we are considering a plan with advertisement as a countermeasure, and it is because 100 million of users are sharing passwords --GIGAZINE
Meanwhile, the New York Times reported that 'Netflix plans to introduce a low-priced plan with ads in the fourth quarter of 2022.' The plan was stated in a memo addressed to employees by Netflix executives.
Reed Hastings CEO also mentioned the low-priced plan with ads in the first quarter of 2022, but at that time it was aimed to implement 'the next 1-2 years', so inside Netflix It is suggested that the timeline for introducing low-priced plans with advertisements is accelerating. 'This is a fast and ambitious plan and will require some trade-offs,' said two people who spoke to the New York Times on condition of anonymity. It seems that it was.
Netflix hasn't offered ad-free low-priced plans so far, but competing video streaming services such as HBO Max and Hulu offer ad-free low-priced plans as well as ad-free standard plans. In fact, Netflix executives said in a note, '(These competitors) are offering ads with ads while maintaining a strong brand.' 'All major streaming companies except Apple are supported by ads. We have or are announcing that we have a service that, for good reason, people want low-priced options. '
Netflix is discussing building an advertising infrastructure with an external company when introducing a new low-priced plan with advertising. Among them, The Trade Desk , which helps advertisers place ads on various online platforms, is also boarded by former Netflix CFO David Wells, who is also on the board of Netflix. Has begun to consider low-priced plans with ads and is attracting attention.
Netflix also plans to charge additional fees to subscribers who share an account with multiple people. The plan has been underway before the announcement of the first quarter 2022 financial results, and already in Chile, Costa Rica and Peru, up to two subs for people living in different locations for $ 2-3. We are testing the option to add an account. In a note to employees, Netflix executives said that low-priced ads with ads would be 'in parallel with a broader plan to charge from users who share an account.' is.
Netflix is testing the ability to share accounts and pay fraudulent viewers-GIGAZINE
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