After launching its offer with advertising on November 3, Netflix does not intend to stop there. Some perspectives were sketched out by the co-director of the Los Gatos firm, Ted Sarandos, who discussed the platform’s business model on Tuesday December 6 at the UBS Global TMT conference in New York.
The offer with advertising intended to expand
Recently available, Netflix’s advertising package offers consumers an additional price option. For €5.99 per month, the lowest rate charged by the firm, subscribers “only” have to deal with the display of a few advertisements on the platform.
On the model of what was done with its standard offer, the company plans to develop this offer with advertising. Going forward, multiple rates and multiple levels of advertising are being considered, as confirmed by Ted Sarandos. “We have multiple tiers now, so it’s likely we’ll have multiple tiers with advertising over time, but nothing yet.indicated this thinking head of Netflix. And the product itself will evolve, I guess, quite dramatically, but slowly, incrementally.”
For Netflix’s content director, this strategy is preferable to that of other platforms, Amazon Prime Video or Apple TV+ in mind, which invest in the broadcasting of sporting events. A model that would not be beneficial to Netflix and which, according to him, is more of what television is currently doing.
A need to remain competitive
This decision can also be explained by the pressure the company is facing to find new sources of growth for its number of subscribers, in a context of increased competition. To revive itself, the company also announced its intention to combat account sharing in 2023, a phenomenon that would affect more than 100 million households, according to the company.