The Netflix Basic with Ads subscription tier launches tomorrow, after the company brought forward its plans to pre-empt a similar plan by Disney. However, the ad-supported tier needs fresh agreements with content owners, and a report today says that five big studios aren’t yet on board …
Background
It’s growing increasingly difficult to make money in the streaming video business. Netflix, Disney+, and Apple TV+ have all increased their subscription fees in a bid to correct this.
But while Apple is happy arguing that the cost increase reflects a significant increase in content, Netflix and Disney are worried about losing [even more] subscribers. Both services are introducing a lower-priced ad-supported tier.
We first learned about the upcoming Disney+ Basic tier when plans leaked back in March. The company waited until August to confirm the plan, when it revealed that it would be increasing the existing subscription fee, while launching an ad-supported one at the old cost of $7.99/month.
Netflix too increased its prices, and decided to follow Disney’s example by offering a lower-priced tier with ads. It accelerated its plans to launch this month, ahead of Disney.
Netflix Basic with Ads
The Netflix Basic with Ads tier launches tomorrow, and will cost $6.99/month.
Unmissable entertainment at unbeatable value: Basic with Ads will cost just $6.99 a month in the US and launch on November 3 at 9 am PT. Available in 12 countries: Basic with Ads will be available in Australia, Brazil, Canada, France, Germany, Italy, Japan, Korea, Mexico, Spain, the UK and the US.
Video quality will be a pathetic 720p, with ads amounting to 4-5 minutes per hour.
Lots of studios not yet signed
We learned back in July that the new tier would require new deals with content owners, and that the service would lack some of the content available in the more expensive packages.
Netflix claimed at the time that the “vast majority” of content would be available at launch, but with just 24 hours to go, a Wall Street Journal report calls that into question. It says that Netflix hasn’t yet reached agreement with five big studios.
Netflix continues to haggle with several major studios for the right to run ads against their content in the new service or put their content on the ad tier, according to people familiar with the matter […]
Among the studios with whom Netflix hasn’t yet finalized revised licensing agreements are Walt Disney, NBCUniversal, Sony Pictures, Warner Bros, and Lions Gate Entertainment, people familiar with the negotiations said.
Without these deals, a lot of popular Netflix content could be unavailable on the new tier, including:
- Breaking Bad
- Grey’s Anatomy
- How to Get Away with Murder
- The Crown
- Cobra Kai
Would you sign up for the cheaper tier given the missing content and 720p resolution? Let us know in the comments.
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