It’s been almost a month since the global video streaming platform – Netflix hinted to the public about plans to crack down on password sharing. The streaming platform attributes the decision as a result of the slow revenue growth as a number of competitors have joined the video streaming space. Netflix was already talking about pushing people who share their account logins to pay more.
For the first time in more than a decade, Netflix records a loss of about 200,000 paid subscribers in the first quarter to competitors like Disney, Warner Bros. Discovery, Paramount Global, NBC, Universal, Apple TV+ and a host of others. It is estimated that by the completion of the second quarter, the company would have lost a total of 2 million more subscribers. According to reports, the company is looking at accelerating its schedule on initiatives to turn things around.
Asides from the crackdown on password sharing, the company is also focused on introducing ad-supported streaming. According to Netflix Co-CEO Reed Hastings, who some time ago hinted that the company will look into the option and will “try to figure out over the next year or two” has recently changed his tune on ad-supported streaming. Hastings admits that introducing an ad-supported tier would be a big change in thinking for the company, claiming he’s historically been “against the complexity of advertising and a big fan of the simplicity of subscription.” A recent note to employees said executives are now aiming to introduce the ad tier at some point in the last three months of 2022, with a crackdown on password sharing starting within the same period. The ad tire according to Hasting may be “quite open to offering even lower prices with advertising, as a consumer choice.”
In March, one of the streaming platforms, Disney Plus reveals its plan to introduce ad-supported streaming in March. While questions like “how long would it take for others to follow?” after the announcement by Disney Plus came to mind, it didn’t take so long before we got the answer. Reports say the majority of Netflix’s streaming competitors, with the exception of Apple TV Plus, either offer or have announced ad-supported streaming tiers. With the new plan, reports say the streaming giant is able to close a gap of an extra 10 to 20 million customers in the US.
All of these changes also arise at a period when Netflix subscriptions have suddenly become more expensive. The most recent price hike raised the monthly subscription of its standard HD streaming plan to $15.49 per month, while its premium tier with 4K and four simultaneous streams now costs $19.99 in the US. Rumors say the price increase will move to other countries in a matter of time.