We’ve known for a little while that there was a cheaper subscription tier coming to Netflix. We have also been aware that the price to pay for a reduction in price is the requirement to view ads — Netflix has teamed up with Microsoft as its advertising partner.
But the inclusion of ads is not the only downside to the cheaper tier. Netflix has now revealed that ad-supported subscriptions will not be able to access all of its video content.
During its earnings calls, Netflix confirmed the rumors that suggested subscribers to the ad-supported tier would not be able to view the same content as those on more expensive tiers.
Company CEO Ted Sarandos said:
The vast majority of what people watch on Netflix we can include in the ad-supported tier. There’s some things that don’t, and we’re in conversation with the studios on. But if we launched the product today, the members of the ad tier will have a great experience.
Now this is undeniably vague, and the devil will very much be in the detail; but on the face of things, it’s not great news. He added that “we will clear some additional content” with that caveat that this would “certainly not (include) all of it”. He added his belief that it is not “a material holdback to the business”.
With the cat now out of the bag that ad-supported subscriptions are a second-rate experience in more ways than one, Netflix is going to have an uphill battle on its hands convincing would-be users that this new tier — which is due to launch next year — is worthwhile. Users will want to be absolutely clear about the shows and movies they will have access to, and which content will only be available to those with deeper pockets.