By: EFE Updated 19 Apr 2022, 22: 47 pm EDT
Netflix is studying the possibility of offering un subscription model with ads in exchange for a lower price, an option that would be available “over the next year or two”, according to its co-founder , Reed Hastings.
The proposal arose during a virtual intervention directed to its investors, after announcing that the platform has lost 200, subscribers during the first quarter of 2022, period in which he obtained net profits of $1.597 million dollars, less than 1.706 from the previous year.
“Those who have followed Netflix know that I have always been against the complexity of advertising and in favor of the simplicity of a subscription“, admitted Hastings, who before the loss of clients was in favor of changing principles.
“I’m even more of a fan of giving consumers choice, and allowing customers who want a lower option and tolerate ads to get it makes a lot of sense. It is something that we will address over the next year or two”, he confirmed.
Other competing platforms in the US, such as Hulu and HBO Max, have cheap options subscription services that interrupt the broadcast of series and movies to introduce short commercial breaks.
Immediately after the company announced on Tuesday its first reduction in the number of clients in a decade, its shares fell by 28% in electronic operations after the closing of the New York markets.
The company linked its stagnation to the appearance of new competitors, such as Disney and Apple, but also recalled that the suspension of its service in Russia resulted in the loss of 700,000 subscribers from that country.
If this decision had not been made, the balance for this quarter would have been different, with 222,000 new users, the company insisted, still far from the growth forecasts that had been set for the start of the year, with 2.5 million new customers.
Inflation, political instability due to the war in Ukraine and the stoppage of filming due to the impact of the coronavirus are other reasons with which Netflix justified its results.
Likewise, Netflix admitted that the possibility it offers its users to share an account between several households is significantly slowing down its growth.
According to its internal data, in addition to the almost 222 millions of active payment accounts on Netflix, others 100 Millions of households log in with another user’s credentials.
“We have to make them pay to some extent for it,” Hastings said.
Last month, the company started a pilot program in Chile, Costa Rica and Peru that will charge an additional amount to those users who share their account credentials with people who live outside the household.
At the moment there is no news of its implementation in other markets.
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