Netflix isn’t done.
It wants to monetize a bit more from its longtime subscribers -- especially those who had its cheapest ad-free plan, paying $11.99 a month. It will soon be ending this plan.
The
company wants subscribers to move up, or down, when it comes to how much they pay per month in its $6.99-a-month plans for its Netflix “Standard with Ads” plan or the pricier ad-free
plans: The $15.49/month “Standard” or its $22.49/month ad-free “Premium”plan.
The soon-to-be-gone $11.99-a-month plan, an ad-free plan (which had seen a price rise as its
‘Basic’ plan at $9.99 in October) allowed subscribers to stream in HD on only one device at a time
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All this follows its recent password crackdown -- where extra
members on an account can be added for $7.99/month.
Netflix realizes that it needs to monetize more money from existing subscribers, especially in the U.S., as its
potential for new subscribers has matured.
The subscription video platform has been transforming its business in a big way starting in November 2022, when it launched
its advertising option.
Massive growth in advertising revenue is expected as its core group of U.S. subscribers -- who number around 22 million -- are on a curve of
steady growth.
Netflix currently has 40 million global ad-supported subscribers.
And what may be the more important metric is advertising revenues. The key
measure here, for many, will now reside in the so-called ARPU -- the average revenue per month per user.
We know the history: For years, Netflix executives had
eschewed any thought of advertising options for consumers. We could guess that Netflix executives believed "advertising" would hurt its premium "brand" value as perceived by
consumers.
That has not happened. Instead, all this seems to have cemented Netflix's role as a “must-have” platform in the streaming world.