We definitely live in the Streaming era and Netflix is one of the platforms with the most subscribers these days. This week, they announced a new package with a format that will accept ads within the platform. Users will be able to subscribe to a cheaper Netflix plan by paying just R$18.90 per month.

We still have little information about what this Streaming model with Netflix ads will be like, as it will only be launched on November 3, 2022.

But what we can say is that it intends to reach an audience that is willing to pay less even if they have to deal with unexpected advertisements when interacting with the platform.

Not much information was released about the monetization policies that the platform will adopt, much less what the advertising platform will be like that they will make available to advertisers. But what we know is this:

Netflix announced that in this cheaper plan, advertisers will have the option to segment/target countries and genres (romance, drama, fiction, action, etc.) so that the advertisements made are more assertive in relation to the public.

Advertisers will also be able to restrict the placement of their advertisements on content that contains scenes of nudity, sex, violence, or any other topic that is not related to the brand and does not violate company policies.

The ads will be 15 to 30 seconds each and will always be shown before and during the streaming content, this will give an average of 4 to 5 minutes of ads for every hour of streaming.
The new plan with ads will only be available, at first, in Brazil and 11 other countries: Germany, Australia, Canada, South Korea, Spain, United States, France, Italy, Japan, Mexico and the United Kingdom.

It's important to start by saying that, for those who have the basic plan or any other plan above that, nothing will change. Netflix is not changing its subscription plans, it is creating a new, cheaper plan with new functionality. 

“The “basic with ads” plan complements the other existing ad-free options: basic, standard and premium”, says the company when issuing its official statement.

Netflix explained that the “basic plan with ads” will have several features present in the “ad-free” one, such as the option to watch on different types of devices such as TVs, tablets and cell phones.

It will have the same video resolution quality (up to 720p/HD) and, in addition, the option to cancel or change the plan at any time remains maintained.

The cheapest plan does not have the download option and due to “licensing restrictions”, some films and series will not be available.

The new plan can be subscribed to by new customers, as well as subscribers who already have one of the other three available plans.

Since it is not a change to the product already offered by the company currently, but rather the creation of a different product, the negative impacts tend to be minimal on the platform's subscribers.

Even if a large portion of subscribers migrates to the basic plan with ads, the platform would still not suffer a loss as it will make a lot of profit from the broadcast of ads in streaming.

Netflix is taking the opposite path to another giant streaming platform, YouTube, which belongs to Google. Google has always generated very high revenue from YouTube monetization, but it realized that it needed to serve a more demanding audience.

This audience doesn't want to waste time with unwanted ads, and that's why Google created YouTube Premium, which is the ad-free version.

Still, most people still consume YouTube videos dealing with ads and that's okay with them.

This shows that there is a very large audience accustomed to the presence of advertisements.

Netflix's movement could generate a very large number of new subscribers who are willing and accustomed to consuming advertisements and who wish to have access to the streaming platform's content.

It won't be long before we know what the impact of this new development will be in real life.