Here’s How Much Netflix’s Ad-Infused Cheaper Subscription Plan May Cost

As I think everyone agrees at this point, Netflix costs way too much money, especially considering all its competition now. But rather than lower prices for existing tiers, Netflix’s plan to create cheaper tiers that serve viewers with ads instead.

It’s not uncommon in the streaming space, there are many ad-supported tiers of other streaming services, but it’s not exactly the fix that customers currently paying $15-20 were hoping for, as half the reason most people switched to streaming was the removal of mandatory commercial breaks. Though Netflix will have less ads than cable TV, per show.

According to a new Bloomberg report, we have the possible price for Netflix’s new ad-supported tier, which is somewhere in the range of $7-9. That’s similar to Hulu’s ad-based plan at $7, and lower than HBO Max’s at $10.

It’s said that Netflix will sell four minutes of commercials per hour for the service, which the Bloomberg report says is “far less than most of its peers” but HBO Max also says they serve 4 minutes of ads per hour. It is less than cable, of course, which is more like 10-20 minutes of ads per hour.

It’s an odd situation for Netflix which has long, long tried to stick with the streaming traditions it started, like no ads, and if they’re reversing course on this because of their competition, I wonder what else may go next. Binge viewing, so they’re not spending tons of money on shows people are no longer talking about after a single weekend? I feel like everything is on the table as Netflix looks to stem losses and increase revenue.

Some estimates put Netflix’s potential gains at $8.5 million from the ad-focused tier. Though it remains unclear how many existing Netflix subscribers may downgrade to that tier from a higher priced one, as opposed to new customers joining up in saturated markets. But of course the bulk of the money is meant to come from the ads themselves, and of all places, Microsoft is the one who won the bid to handle Netflix’s ads. The megacorp has a $10 billion ad business that’s rarely talked about, because of course it does.

All of this raises the question of whether time is just a flat circle here, and we’re about to go back to people subscribing to half dozen, ad-supported services with weekly series that looks like and costs as much as cable TV did in the first place. The entire concept of the sustainability of the streaming content model has been called into question in recent years, and while obviously we will never literally fully go back to cable, expect a lot more ads and perhaps less binging in the future.

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