Recently we heard that Netflix was planning to introduce an ad-supported tier in the next two years. It looks like that’s now happening sooner than expected. The company is also reportedly planning to lock down account sharing a little more rapidly than expected.
The company indicated to employees that an ad-supported version of Netflix will be available later in 2022. This memo was obtained by the New York Times. The publication claims employees were told that an ad-supported tier would turn up in the last three months of this year.
After dismissing the idea of ads on the service for ages, co-CEO Reed Hastings had a recent about-face. The change came after Netflix saw a drop in subscribers for the first time in about ten years. The company lost about 200,000 subscribers, following which its stock took a massive dive.
The note also suggested a password crackdown, saying that there will be an extra fee for subscribers who share their passwords with others at a different address. This isn’t exactly news — talk of Netflix charging a little extra has been around for a few months. What is new is that this extra charge should come into being at the same time as that ad-supported version of the service does. So… expect it at year-end?
Netflix is playing off an ad-supported tier as beneficial for users, pointing out that other services have a similar offering. The password-sharing lockdown is a little less for subscribers. That’s all about improving the service’s profitability.
As to where these changes will kick in, there’s no indication which regions Netflix will target first. Though the details all come from an American source, it’s likely that Netflix’s changes will roll out globally — at least eventually.