Netflix is reportedly planning to launch a cheaper ad-supported subscription later this year, around the same time the company is cracking down on password sharing.
In an internal letter obtained by the New York Times present, the streaming giant has informed its employees of the planned changes. Although the company has informed its employees of the adjustments, it has not revealed many details about them. At the last quarterly earnings call, Netflix CEO Reed Hastings said that the company would take its time with introducing an ad-supported plan and that it would "find a solution in the next one to two years." However, in an internal letter, the company appears to have accelerated that timeframe, stating that the planned changes will be "quick and ambitious" and "may require some compromises." Netflix pointed out that "every major streaming provider except Apple has or has announced an ad-supported service," adding that consumers want "more affordable options." Netflix has seen a decline in subscribers in recent quarters.
Netflix wants to prevent account sharing
In the first quarter of 2022, for example, Netflix lost 200,000 subscribers - its first loss in more than ten years. A loss of two million is also expected for the current quarter. Although Netflix recently increased the prices of its various subscriptions, the company blames the loss of subscribers in part on the sharing of passwords - i.e. account sharing. The company plans to take action to combat this practice over the course of 2022. In the internal letter, Netflix described the measures as allowing users to share their passwords "easily and securely" if they "pay a little more". Netflix announced that it would test these changes in certain regions, but did not say when it would roll them out more broadly. However, Netflix told employees that these mechanisms will be introduced "around the same time" as the ad-supported offering. (Photo by SerGrey / Bigstockphoto)
