Netflix is upgrading its ad-supported plan in terms of streaming quality and simulcasting. The company said that users subscribed to this plan will be able to view content in 1080p resolution (instead of 720p) with support for two simultaneous streams.
These benefits are rolling out to users in Canada and Spain today. People using ad-supported plans in 10 other markets, including the US, will get these features this month.
“We believe these enhancements will make our offering even more appealing to a broader set of consumers and further strengthen new and existing subscribers’ engagement with the ad plan,” the company said in its letter to investors.
Netflix launched the ad-supported plan last November at $6.99 per month and is already seeing positive results.
The streaming company said that in the US it is getting more average membership revenue through the ad-supported plan than the standard plan, which costs $15.99 per month.
During the earnings call, Netflix CFO Spence Neumann said the company released new content at the ad-supported level in the last quarter, bringing it to “95% more” parity with other higher-priced plans. .
He mentioned that the ad-supported plan is also showing beneficial results for the business,
“All of this (the economics of the ad-supported plan) is at a level that we think is not only better for our members with a lower price option, but better for our business and we think we could and are doing it in a De That way, I would say, without getting too specific, think of it as a 50% or more incremental profit contribution to the business,” he said.
According to Insider Intelligence, Netflix will generate $770 million in advertising revenue this year, and this number will increase to $1.9 billion in 2024.
The firm expects Netflix to have 170.6 million users (a 0.5% year-over-year drop) in the US and 682.7 million users worldwide (5.6% year-over-year increase) by the end of the year. of year.
The company also revealed plans to implement restrictions on password sharing more broadly this summer. The company posted $8.16 billion in revenue for the first quarter of 2023, slightly below analyst expectations of $8.18 billion.