Netflix is about to say "goodbye" to one of its few good features.
The streaming giant has been going through some very tough times lately. The company has been bleeding subscribers and losing tons of money with its woke programming and competition heating up from more streaming services.
It's been a disastrous year.
And now, for the icing on the cake, Netflix just announced that, for the first time, the streaming service will be allowing ads.
Netflix co-CEO Ted Sarandos confirmed on Thursday that the company would begin testing an ad-supported, lower-priced subscription tier. The streaming company is speaking to multiple potential partners to help ease its entrance into the ad world, Sarandos said while speaking at the international ad festival Cannes Lions. Those partners reportedly include Comcast, NBCUniversal, and Google.
Netflix is now going to the truly awful Hulu model where the basic tier includes advertisements while watching features. If you want to avoid the ads you'll have to shell out a little extra moolah.
"We've left a big customer segment off the table, which is people who say, ‘Hey, Netflix is too expensive for me and I don't mind advertising,'" Sarandos said. "We're adding an ad-tier. We're not adding ads to Netflix as you know it today."
Who are these mysterious people who don't already pay for Netflix who would pay for a cheaper version where they have to sit through ads?
I don't know anyone who wants to pay to sit through commercials.
This is just the co-CEO having to run cover for a necessary, but terrible move.
But at least they aren't changing anyone's current Netflix subscription to the ad tier. They're simply introducing a cheaper tier.
Netflix co-CEO Reed Hastings had telegraphed the advertising plan, suggesting on a first-quarter earnings call in April that ads could be on the way in the next year or two. "Those who have followed Netflix know that I've been against the complexity of advertising and a big fan of the simplicity of subscription. But as much as I'm a fan of that, I'm a bigger fan of consumer choice," he said. "And allowing consumers who like to have a lower price, and are advertising tolerant, to get what they want makes a lot of sense."
"The customers have spoken! They LOVE commercials!"
Translation: "We are losing money hand over fist and this is a last-ditch effort to try to make up for lost revenue."
The spin to try to turn this into a positive is ridiculous.
Netflix is in deep trouble.
And I don't think this hail mary is going to get them out of it.
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