Netflix recently reported the loss of 200,000 subscribers globally compared to Q4 and now forecasting an even bigger loss in the coming quarters. So, the company is now planning to introduce ad-supported plans at lower prices.
Customers who do not want ads can continue with ads-free premium plans. Ads-supported plans aim to bring more people to the platform who think that existing subscription plans are costly.
Netflix has lost customers for the first time in a decade. The last time the company reported subscribers loss was in October 2011. The platform pulled out of Russia recently and lost 700,000 users.
The company has been asked to bring ads for additional revenue but Netflix has always shot down the idea. It is always thought that ads aren’t suited to the company’s model. But ads model has helped several companies including Hulu and Disney. Now when the company is struggling, it can try bringing a lower-tier subscription plan with ads.
In addition to ads-supported plans, Netflix is also looking to earn more from customers who share their accounts with others. The company is already testing sub-accounts for additional prices.
After the company reported financial results, shares fell as much as 27% to $256 in extended trading.
