In early November 2022, Netflix launched a formula Essential with ads cheaper at 5.99 euros per month. In return, subscribers must agree to have their programs interrupted by advertising spots.
While one might have thought that this offer was unique, this is obviously not the case. In any case, this was explained by Ted Sarandos, co-CEO of Netflix, in an interview with CNBC.
“We have multiple levels (of subscriptions) todayhe recalls, so it’s likely we’ll have multiple levels of publicity over time.”. These unequivocal words are part of a larger demonstration of the company’s future strategy. According to Ted Sarandos, Netflix will therefore rely on advertising to win over a new audience with other prices.
The party is over
By the way, the co-CEO of Netflix took the opportunity to remind that account sharing was in the sights of the company. “There are people enjoying Netflix, literally for free today, he recalls, I think they will be happy to have their own account”.
Understand that for Ted Sarandos, the more affordable offer with advertising can be a good compromise to access Netflix at a lower cost. Yes, but 6 euros is still more than zero.
This is why the company has planned to go hunting for shared accounts from 2023. How? By charging all users of the same account. If the details of this formula are not yet known, it is certain that account sharing as we know it today will no longer exist from January 1, 2023.
A difficult year 2022
This new strategy is being put in place after a complicated 2022 for Netflix. For the first time in its history, the SVOD service has lost subscribers two quarters in a row. A drop in speed which can be explained first by the successive price increases while the content catalog is less attractive.
Above all, Netflix faces fierce competition. The arrival of Disney+ (which quickly conquered millions of users) with an attractively priced formula and a rich catalog (Disney classics, Marvel, Star Wars) undoubtedly weighed on the balance.
Paramount+, which has just landed in France, and Apple TV+ are also two serious competitors of Netflix. In the United States, HBO Max (which could absorb Discovery + to become simply Max) also has enough to attract an audience tired of Netflix.