Netflix has announced that it is working on developing a more affordable Netflix subscription tier that will be supported by supplementary advertisements. Over the past two years, Netflix subscriber counts have become more of a focus for the company as many consumers share their passwords with multiple other households. The current estimation is that just under half, or as many as 100 million subscribers, are sharing their accounts with one or more other users.
Last month, Netflix announced a new initiative to curb account sharing abuse by offering sharers the ability to tag-on to a main subscriber with a small $3 fee in order to secure their own account. However, this was simply a strong suggestion rather than an enforced policy. Now, the streaming giant is attempting to offer a more attractive, accessible option to generate revenue while providing viewers with their content fix. It is not yet confirmed whether the ad-supported tier will be free or will be a discounted subscription cost, but Netflix confirmed that it will unveil more finalized details in the next year.
Ad-Supporting Streaming Services
Netflix is Developing a More Affordable Subscription Tier
Trend Themes
1. Ad-supported Streaming - The rise of ad-supported streaming services offers opportunities for brands to target specific demographic groups through tailored advertising.
2. Account Sharing Prevention - Technologies that prevent account sharing, such as Netflix's $3 tag-on fee, disrupt traditional subscription models and create new revenue streams for streaming services.
3. Affordable Subscription Tiers - Developing more affordable subscription tiers, including ad-supported options, allows streaming services to tap into price-sensitive markets and expand their user base.
Industry Implications
1. Streaming Services - Streaming services can benefit from ad-supported tiers and account sharing prevention technologies to increase revenue and attract price-sensitive consumers.
2. Advertising - The rise of ad-supported streaming services presents opportunities for advertisers to reach a wider audience and target specific demographic groups with tailored ads.
3. Technology - Developing technologies that prevent account sharing and enable targeted advertising on streaming platforms is a disruptive innovation opportunity for tech companies.