Report: Millions Would Drop Netflix With Advertising

Netflix has steadfastly refused to insert third-party advertising in programming as Hulu does on its basic subscription plan.

New data from Hub Entertainment Research contends the SVOD behemoth could lose 23% of its subscribers if it added advertising, according to a June survey of 1,765 U.S. broadband consumers. About 41% of respondents said they would keep Netflix.

The SVOD pioneer ended its most-recent fiscal period with nearly 150 subscribers worldwide, including more than 50 million in the United States.

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Hub found more receptive respondents to ads on Netflix if the service also lowered the monthly subscription plan pricing. About 33% of respondents said they would accept ads if their monthly plan decreased by $1.

The percentage of ad converts increased when the monthly fee dropped by $2 or more with 53% saying they would keep Netflix and 14% saying they would not.

“The success of any Netflix ad-supported plan — whether to replace or add to its current offering — will naturally depend on whether consumers feel they’re getting a sufficient price-break return on their ad-viewing investment,” Peter Fondulas, analyst and co-author of the study, said in a statement. “But one thing is clear from these results: after one increase already in 2019, any attempt by Netflix to use an ad-supported plan as a reason to hike its ad-free price again could seriously backfire.”

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