Netflix is planning to introduce adverts to the platform sooner than expected – and this is all to beat Disney.
While the idea of Netflix having adverts on it may be horrifying to many, this change is seemingly inevitable. And now it’s going to be happening sooner than we thought.
Netflix is moving the release of its cheaper, ad-supported plan to November, and this is in order to get it out before the December 8 launch of the Disney+ tier with advertising.
This is likely in response to the recent turn of events that saw Disney+ beating Netflix in terms of subscribers.
Netflix wants to beat Disney+ with ads sooner rather than later
In July, Netflix stated to Variety that it was planning to release the ad-supported plan “around the early part of 2023.” But this date has now been pushed forward a few months, to November 1.
This would be over a month earlier than the release of Disney+ Basic, which is priced at $7.99 per month, and hits the market in the US in December.
The Netflix plan will go live in multiple countries, including the US, Canada, UK, France, and Germany. Initially, for the first phase of the ad tier’s rollout, Netflix will only serve ads based on the viewer’s country, and not by age, gender, viewing behavior, or time of the day.
The ad-supported tier will have an advert load of around four minutes per hour for series, and for movies, there will be pre-roll ads. Netflix is also setting frequency caps of one ad per hour and three ads per day per viewer, which is relatively low by industry standards.
There isn’t any official pricing yet for the plan, but it is reportedly going to be between $7-9 each month.
Netflix’s new ad prices are very much a “wait-and-see” game
Netflix and its ad partner Microsoft have requested ad buyers submit initial bids next week, with a “soft $65 CPM” (the cost per thousand views), meaning that the company is open to negotiating its ad rates. But $65 is well above the industry standard CPMs of sub-$20, and sources say that many advertisers aren’t willing to pay that much.
One ad buyer said: “My guess is they won’t get that,” and that the feedback from brands is “very much wait-and-see.”
Netflix wants to lock in any ad buyers by September 30, and expects to have about 500,000 customers on its ad-supported plan by the end of 2022.