Netflix Details New Cheaper Ad-Based Tier – And It’s Quite The Compromise
We’ve known for some time now that Netflix was planning to launch a new cheaper subscription tier for its global video streaming service. Today, though, Netflix has finally unveiled the full details of the new ‘Basic with Ads’ package – and it’s fair to say it’s got a few surprises up its advert-filled sleeves. By no means all of them good.
The new tier is set to launch on November 1 at 9am PT in Canada, and on November 3 at 9am PT in the US, and 4PM GMT in the UK. When it comes to the all important matter of price, it will be available to new subscribers (current subscribers will see no change to their service for the duration of their current subscription), for $5.99 a month in Canada, $6.99 in the US, and £4.99 in the UK.
On the surface of it, despite me being old enough to remember when you could get a ‘full’ Netflix subscription for £5.99, the new tier looks like it could be solid enough value in the context of Netflix’s current pricing structure – especially for UK subscribers. When you start looking at the details of the Basic with Ads subscription, though, the value for money appeal starts to become more questionable.
Particularly problematic for me is the surprising news that the maximum picture resolution for the Basic with Ads tier will be 720p. That’s not even full HD, at a time when almost the only TVs you can buy these days are native 4K.
Depending on how much bandwidth Netflix gives these Basic with Ads streams, it’s possible that the lowly 720p resolution will also be affected by compression artefacts. And in any case, given the number of 4K TVs now in circulation it’s fair to say that a 720p Netflix service is going to lead to that an awful lot of upscaling processing in living rooms across the world. Which isn’t ideal given that many budget and some mid-range TVs struggle to upscale full HD particularly well, never mind 720p.
Then there’s the ads. Obviously we’ve always known there were going to be ads involved, but Netflix has confirmed today that these ads will be between 15 and 30 seconds each, and will play for an AVERAGE of four to five minutes per hour of viewing. That seems like quite a lot to me for a service which, don’t forget, you’re still going to be paying nearly $84/£60 a year for. Especially when that service is serving up best case picture quality that’s nine times worse (or, at least, 9 times less in resolution) than the best pictures most of today’s 4K TVs are designed to handle.
What’s more, Netflix has confirmed that the ads will appear both before AND DURING TV shows and films, making them pretty much as disruptive to the viewing experience as they are on free to view advertising-carrying broadcast channels.
Let’s hope that the need to include ads for the Basic with Ads tier doesn’t lead to tweaks to the structure of Netflix’s in-house productions.
More bad news finds Netflix admitting that a ‘limited number’ of movies and TV shows won’t be available on the Basic with Ads platform, at least at launch, due to licensing restrictions. Netflix adds to this point that it’s working on sorting the licensing issues out, but initially, at least, the bottom line is that the Basic with Ads tier won’t offer the same amount of content that the ad-free tiers do.
Finally in the negative column, it apparently won’t be possible to download titles for off-stream viewing with Basic with Ads like it is with Netflix’s higher tiers.
Some things stay the same with the new tier, of course. MOST of the content will still be there, Netflix’s personalised viewing features will still be available, you’ll still be able to watch Netflix on a wide range of TV and mobile devices, and you’ll still be able to change or cancel your plan at any time. Nonetheless, Basic with Ads really does involve a lot of viewing compromises for a service you still have to pay a certainly not negligible amount for.
So much so, actually, that I can’t help but wonder if Basic with Ads’ real value to Netflix is as a ‘gateway’ service, designed to lure in new subscribers who then can’t resist stepping up to more expensive tiers for a more satisfying experience.
That said, I should say right away that Netflix is at pains in its Basic with Ads announcement to stress what an ‘exciting opportunity’ the new tier is for advertisers, discussing such features as broad targeting capabilities based on country and genre, and the ability for advertisers to stop their ads appearing within content that might be inconsistent with their brand (such as sex and violence).
Netflix also states that it has partnerships in place with DoubleVerify and Integral Ad Science to provide verification of the viewability and traffic validity of Netflix ads from the first quarter of 2023, and states that it will be using Nielsen’s Digital Ad Ratings (DAR) system in the US once it becomes available at some point in 2023. This revelation comes on the back of earlier news stating (covered here) that Netflix has signed up with audience measurement experts BARB in the UK to supply independent daily updates on Netflix’s viewing figures and audience shares.
It will be interesting to see the wider public and business reaction to Netflix’s new offering, but I have to say that I for one will not be tempted.