It’s official – Netflix’s ad-supported plan will soon be available to U.S. streamers. After a difficult year of subscriber loss, the company plans to release the lower-cost “Basic with Ads” subscription plan in early November, while still retaining its original ad-free tier.
What could that mean for the media titan? CivicScience data show that interest in an ad-free Netflix subscription plan is likely to cause some disruption among current subscribers, but will also appeal to current non-subscribers.
One-third of current Netflix account owners say they would be likely to make the switch to a lower-cost or free ad-supported version, while two-thirds would stick with the ad-free version at $9.99 per month. These percentages largely remain unchanged since July, when CivicScience last reported on the topic.
Among U.S. adults who do not currently own a Netflix account or use Netflix at all, 28% say they would be likely to sign up for an ad-supported version. That’s up two percentage points since July, after interest fell precipitously quarter to quarter this year, which could fare well for the new Basic with Ads plan.
It’s likely the new ad-supported plan will be received well. For one, the market has become more diversified over the course of 2022 and consumers are becoming increasingly likely to subscribe to multiple streaming services. Current data find that the majority of streamers (53%) now subscribe to three or more streaming services. What’s more, subscribers who toggle between four or more services climbed from 25% in January to 28% in October. This is a trend that appears to be growing.
Given the squeeze on U.S. households from inflation and rising energy costs, the Netflix ad-supported tier may be welcome by middle- and lower-income households. The greatest interest among current Netflix users and non-users alike is seen among those earning $50K or less per year.
CivicScience will continue tracking developments on this topic.
