During its quarterly earnings report, Netflix said it is exploring plans that include ads for a lower price.
Reed Hastings, Netflix co-CEO, has long been opposed to adding commercials or other promotions to the platform but said during the company’s prerecorded earnings conference call on Tuesday that it “makes a lot of sense” to offer customers a cheaper option. Although Hastings said an ad-supported plan is still a year or two away, it’s a moment Netflix subscribers might potentially dread.
Netflix faces intense competition from streaming rivals, but was also hit after it raised prices and left Russia. This coupled with their customer base spending less time at home in front of their TVs as pandemic restrictions have lifted.
Netflix also blamed password sharing for its growth problems, saying that 100 million households were sharing passwords instead of paying for more than one account. Having multiple users share accounts “means it’s harder to grow membership in many markets,” the company said in its letter to shareholders.