Netflix’s Basic with Ads tier is finally making waves with an increasing number of subscribers.
After launching in November, the Netflix Basic with Ads tier was the least-subscribed option on the streaming channel. This changed quickly, with the service reaching about 1 million active monthly users in January, just two months after launching.
Market research by Antenna shows that ad-tier subscriptions increased from 9% to 19% in January. It is also interesting to note that the majority of customers signing up for the Basic with Ads tier are not existing customers.
According to Antenna, the ad tier is now responsible for 20% of new signups in the U.S.
Despite showing signs of success, this ad tier is seeing slower signs of growth compared to the likes of HBO Max and Disney+ when they introduced similar subscription plans.
The ad tier’s newfound subscription increase could run into challenges with Netflix's crackdown on password sharing. The streaming service plans to restrict password sharing in the U.S. soon, where the majority of its subscribers are located.
In Canada, Portugal and Spain, users have been forced to either pay more for password-sharing accounts or switch to a different subscription plan entirely.
Subscribers in Latin America faced a similar ordeal. However, the streaming channel’s quarterly report showed surprising results. The number of subscribers in countries where free password sharing has been forbidden has actually increased.
How U.S. users will react to this change remains to be seen, as well as whether it will force subscribers to switch to the Basic with Ads tier as the most affordable and effective subscription plan.
