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It’s finally happening! Thursday, Netflix announced that it will launch the company’s first ad-supported plan starting in November, in an apparent effort to keep up with rival streaming services.
The new plan, called Basic with Ads, will cost just $6.99 per month, which compares to Netflix’s current ad-free plans of Basic at $9.99 per month to watch on one compatible device at a time, Standard at $ 15.49 per month for two compatible devices and Premium at $19.99 per month for up to four compatible devices.
As of now, there are no announced plans for the ad-supported tiers of the Standard and Premium plans, but depending on how the initial launch goes, you have to imagine they won’t be far behind.
Basic with Ads is meant to complement the streamer’s current offerings and says ad-free plans and members won’t be affected.
Aside from the introduction of ads, which will average four to five minutes of commercials per hour that are 15 or 30 seconds long, Netflix says the only other difference subscribers will see with the ad-supported plan is that a limited number of movies and TV shows. programs will not be available initially due to licensing restrictions. However, they are already working to fix the problem. There will also be no option to download titles in the ad-supported format.
The news comes amid Netflix raising subscription costs for the first time in three years in January, leading to a worrying loss of 1.2 million subscribers in the first two quarters of 2022. Likewise, a recent survey found that one in four Netflix users was planning to leave the platform by the end of the year. Before the level of advertising was announced, Netflix was the most expensive of all the streaming services currently available.
Amid continuing projected losses, Netflix co-CEO Ted Sarandos first confirmed plans for lower-cost, ad-backed options during the company’s appearance at the Cannes Lions ad festival in June.
“We’ve left a large segment of customers off the table, which is the people who say, ‘Hey, Netflix is too expensive for me and I don’t care about advertising,'” Sarandos said at the time. “We are adding a level of ads, we are not adding ads to Netflix as you know it today. We’re adding a level of ads for people who say, ‘Hey, I want a lower price and I’ll look at the ads.’”
Basic with Ads will launch in the United States on November 3, and the initial release will be available in 12 countries, including Australia, Brazil, Canada, France, Germany, Italy, Japan, Korea, Mexico, Spain, and the United Kingdom.