Could This New Netflix Feature Help Reduce Your Monthly Cost?

A mother, father and two daughters sit on their living room couch and share popcorn while watching a movie.

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Although it seems like everyone you know has Netflix subscription, the reality is that the company has had a tough year. Netflix’s stock price plunged after recent earnings failed to live up to expectations. Not only that, the streaming services giant reported a loss of 200,000 subscribers in the last quarter which, unsurprisingly, led to significant layoffs within the company.

Therefore, Netflix is ​​looking for ways to increase revenue and attract consumers to try its service. So it looks at lower-priced options that may be attractive to consumers at a time when inflation is soaring and people are cutting back on discretionary spending out of necessity.

But are the lower-cost options good for you? It depends on your tolerance for ad-supported content.

A change is in the works

Earlier this year, Netflix raised its prices on various content tiers. A basic non-HD Netflix subscription costs $9.99 per month, and it allows you to stream on one device at a time.

Meanwhile, the standard plan costs $15.49 per month, and it gives you the option to stream on two devices at the same time. Netflix’s most expensive tier costs $19.99 per month, but it includes the highest quality images and the option to stream content across four devices.

However, none of these tiers lead viewers to ads. But that will change.

Netflix is ​​now looking to launch a lower price tier that includes ads in a bid to grow its subscriber base. And it’s definitely not a new concept. Other competitions streaming service, like Hulu, for example, have lower-cost plans for subscribers who are willing to follow ads. So, if it worked for them, it might work well for Netflix.

Should you sign up for Netflix with ad-supported content?

Netflix’s new tier will probably save you some money. But whether it’s worth the sacrifice of having to watch ads all the time is something you have to think about.

If you don’t mind ads, you might as well try Netflix’s new offerings and save some money in the process. Similarly, if money is tight, then Netflix’s new tier could be a good solution for you — one that gives you access to content without causing you to add too much to your month. credit card tabs.

But if you’re someone who doesn’t pay for cable and Netflix is ​​your only streaming service, then you might want to stick with ad-free content — even if that means paying a little more. This is especially true if you have no trouble paying bills and can easily rock your Netflix subscription.

Offering ad-supported content is a strategic move for Netflix at a time when Netflix needs serious increases in subscriptions and revenue. Whether it works, however, remains undetermined. But as a consumer, it’s good to have the option of accessing entertainment at relatively low prices, and if you’re willing to sit through the ads you can save a decent amount of money.

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We strongly believe in the Golden Rule, which is why editorial opinions are our own and have never been reviewed, approved or endorsed by an included advertiser before. The Ascent does not cover all the offerings on the market. The editorial content of The Ascent is separate from the editorial content of The Motley Fool and is created by a different team of analysts.Maurie Backman has a position on Netflix. The Motley Fool has the position and recommends Netflix. Motley Fool has disclosure policy.

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