At the moment Netflix does not contemplate a low-cost subscription with ads The position of the streaming giant is clear despite the announcement that Disney +, its main competitor, analyzes lower cost plans with integrated advertising.
By Entrepreneur Staff Edited by Eduardo Scheffler Zawadzki
This article was translated from our Spanish edition.
A couple of days ago, the Disney+ streaming service announced that it is analyzing the possibility of offering a low-cost subscription that includes the presence of commercials from other brands. Faced with the declaration, Netflix has marked its position : at the moment there are no plans to incorporate third-party advertising into its business model. The announcement was made by the company's CFO, Spencer Neuman , during his participation in the Morgan Stanley Technology, Media, and Telecom conference. The company's top executive assured that, although Netflix has nothing against advertising, its current model does not contemplate it.
As Stanley explained, the user experience is a priority issue for Netflix and incorporating the presence of third-party brands could negatively impact it. Although later he clarified that they were not denied the idea, as long as they find a way to combine it with their contents without it being invasive. Those, as we know from our own experience, represent quite a challenge.
The reality is that with new options on the market (HBO Max, Disney+, Paramount and Amazon Prime to name just a few), Netflix is facing stiff competition and some of these platforms are already experimenting with lower cost subscription models incorporating advertising.
Although Netflix remains the undisputed leader in streaming with more than 222 million subscribers worldwide (followed by Disney+ with 179 million), its penetration is not the same in all countries and growth figures have slowed down. These facts could force the company to rethink the issue or develop business models differentiated by region in the future.
