Withthe continuous fall in the number of users and an utterly disappointing performancein the first quarter this year, Netflix has undergone a new policy change andis all set to launch Advertisement based model in association with Microsoft. Thismeans that the content on the OTT platform can be viewed at a considerablylower price.
Netflixsince the beginning has been against showing the ad to its customer. Now, sinceNetflix is launching the ad-supported subscription, this will be in addition tothe existing plans. Microsoft will manage and design the platform for itsadvertisers. Netflix in April announced they are coming up with a framework tolaunch an ad-supported subscription model, whose price will be less for theconsumers.
When will Netflix launch its new plan?
Asper the report published in The New York Times, the ad-supported plan fromNetflix is expected to be launched by the end of this year. However, it is notclear yet whether Netflix will launch it worldwide or in some selectivecountries.
OTT Platforms with Ad-based model:
Atpresent in India, Disney Hotstar, Voot, Sony Liv, Zee 5, Discovery Plus, and MXPlayer runs Ad while streaming. The subscription plan on these platforms isfairly cheaper. For instance, the annual plan of Disney Hotstar is available atjust 899. One can view Ad free Movies and Shows on this plan, with ads duringthe streaming of sporting shows. Disney offers certain shows for free with thead.
By how much will the Netflix Pricefall?
SinceNetflix has made its way in the country. It has faced competitive pricing fromthe players in the market. Disney plus Hotstar, Amazon Prime, Sony Liv, and Zee5 have given a tough fight to Netflix and its plans. For example, the premiumannual subscription of Disney is Rs 1499, whereas the same plan for Netflix isavailable at a far costlier Rs 499 a month and 4K+HDR at 649. To allure thecustomer base in India it is expected that Netflix will launch a price model atpar with these existing OTT platforms.
How much will users get benefitted?
Theplans available at Netflix are considerably higher than other OTT platforms.For this many prefer other platforms than Netflix. Before the launch of the newAd-supported plan, the price of existing plans will fall. Through this OTTusers will get benefitted. Users will be provided with the option of Ad-Basedand Ad-Free plans.
Why Netflix has gone for Microsoft?
Theprime reason behind this is in comparison to other tech giants, Microsoft and Netflixshared a great share of closeness and their interests haven’t clashed in pastin any regard. Another big and far more important reason seems the availabilityof top tech giants, Google, Meta, and Amazon in the streaming service platform beforehand.Whereas Microsoft hasn’t advanced much in this regard.
Where does Netflix stand in the OTTrace?
Asper the data from the Centre for Media and Entertainment Industries (CMES) the total minutes of OTT consumptionin India has increased from 181 to 204 billion. This shows how rapidly theusers in India are increasing on the OTT platforms. In the past few yearsdigitalization has got a huge boost in India. The COVID pandemic has helped inthe rise of OTT users in the country. At present India has 35 Crore OTT userswhich are expected to touch the 50 crore mark soon.
The challenges for Netflix:
Afterhitting the Ad-based subscription model the biggest challenge for Netflix willbe Data Privacy. As per the users’ interests, their data can be harvested. Netflixis facing the issues of password sharing, based on the multiple streamingfacility it provides on a single account.
Dueto this, people share their passwords with other people apart from their familymembers. Due to this Netflix is facing huge losses. A pilot project in thecountries like Chile, Peru, and Costa Rica has been launched to tackle thisissue. As per a report published in this regard, it was found that around 33%of Netflix users share their passwords with at least one person outside theirfamily.