Netflix seems to be charting a new course. The company’s recent decision to phase out its Basic plan marks a significant shift in its strategy, as revealed in its latest earnings call. The company has been grinding down hard on its cheaper plans to accommodate the rapidly inflating economy, and now, these steps are getting a bit too serious.
The Basic plan, known for its affordability at $11.99 and ad-free viewing, has been a staple for many. However, in a landscape where content consumption is evolving, Netflix is adapting. The plan, which stopped being available to new or returning users last summer, is still in use by existing subscribers. But its days are numbered, with the UK and Canada set to see it phased out first.
This change is part of a broader trend in Netflix’s approach. The company’s focus is increasingly on its ad-supported content, which has seen a surge in popularity. In fact, ad-based subscriptions have grown by 70% quarter over quarter, now making up 40% of all new Netflix sign-ups in relevant markets.
What does this mean for subscribers? Options are narrowing. Once the Basic plan is gone, the ad-free experience will be limited to the Standard and Premium tiers. The Standard plan, at $15.49 per month, offers full HD streaming and support for two devices simultaneously. The Premium tier, priced at $22.99 per month, ups the ante with Ultra HD, streaming on six devices, and additional member options.
While some may see this as a reduction in choice, it’s a strategic move by Netflix. The streaming giant is not just tweaking its subscription models; it’s also investing in exciting content. The much-anticipated Squid Game Season 2 is set to release in 2024, and a new deal gives Netflix exclusive streaming rights to WWE Raw in 2025.
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(Via)
