In this illustration, the Netflix logo in the App Store is displayed on a smartphone screen.
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After years of fending off ads on its streaming service, Netflix Co-CEO Reed Hastings said it is now “open” to offering lower prices with advertising.
Hastings has long opposed adding advertising or other promotions to the platform but said on the company’s pre-recorded earnings conference call that offering customers a cheaper option is ” very meaningful”.
“Anyone who’s followed Netflix knows that I’ve resisted the complexity of ads and am a big fan of the simplicity of subscriptions,” added Hastings. “But I’m a fan of that, I’m more of a fan of consumer choice and allowing consumers who want lower prices and ads to get what they want. meaning.”
This option may not be available on the service for a year or two, Hasting said. A new level of ad support There’s a lot of profit potential for Netflix, it just reported lost its first subscriber in over a decade on Tuesday.
Netflix cited increasing competition from recent streaming launches by traditional entertainment companies, as well as rampant password sharing, inflation, and Russia’s continued invasion of Ukraine. caused a recent stagnation on paid subscriptions.
In an effort to attract more subscribers, Netflix has increased spending on its content, especially on originals. To pay for it, the price of its services has gone up. The company says these price changes are helping to boost revenue, but are partly responsible for the loss of 600,000 subscribers in the US and Canada in the most recent quarter.
A lower-end option that includes advertising could keep some price-conscious consumers with the service and give Netflix another avenue to make money.
“Obviously it’s working for Hulu. Disney is doing it. HBO has done it,” Hastings said. “I don’t think we have much doubt that it works.”
This is a breaking news story. Please check back for updates.
