Netflix Customers Would Be Open to Ad-Based Model With Right Value, Says Hub
Amid speculation Netflix is considering an advertising-supported subscription plan, Hub Entertainment Research released survey results Wednesday saying many subscribers would be open to the idea but only with a “significant discount." If Netflix included ads and kept current pricing, 41…
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percent said they would definitely or probably keep the service vs. 23 percent who said they would definitely or probably drop their subscription. If Netflix added an ad-supported tier as an option, a $3 lower price could persuade subscribers to sign up for the ad-free alternative, Hub said, while a $1 price drop for ad-supported “wouldn’t move the needle much.” If the current ad-free plan rose by $3, 58 percent of subscribers would switch to an ad-based tier at the current fee; 20 percent would quit, it said. The success of any Netflix ad-supported plan -- whether a replacement plan or supplemental one -- depends on whether consumers feel they’re getting a sufficient price break and value, said analyst Peter Fondulas: “Any attempt by Netflix to use an ad-supported plan as a reason to hike its ad-free price again could seriously backfire.” The July online survey was conducted with 1,765 U.S. consumers ages 16-74 who watch a minimum of one hour of TV weekly. Netflix didn't comment.