Netflix’s Ad Tier Hits 15 Million Users, Spurred by Password-Sharing Crackdown and Price Shifts

After many years of insisting that its platform would remain ad-free, Netflix’s ad tier launched a year ago. At the same time, Netflix also put significant efforts into its password-sharing crackdown, another long-time facet of the platform. And it seems like, in combination and alongside strategic price shifts, Netflix’s ad tier has found success.

Camille Usher with white hair and blue dress in fall of house of Usher for Netflix ad-tier update article

In May, Netflix revealed that its ad tier had 5 million monthly active users. It now shares that number has tripled in its latest report. In a blog post, Netflix notes that its ad-supported plan “[reaches] 15 million global monthly active users.” That is indeed a huge jump. In that span of time, Netflix became increasingly strict about account-sharing. And it also moved to increase the price of its ad-free offerings. Deadline notes that “Instead of paying the new fee to share their passwords, evidence suggests that many subscribers simply enrolled in the ad-supported plan.” Since Netflix’s ad-free plans cost nearly double its current ad-supported tier, it’s not surprising that users would be drawn to the cheapest option when faced with needing to change their mechanism of viewing.

Unfortunately for the consumer, it seems like what’s always been true for the television and movie business remains true for streaming. Ads generate money. Across the board, streaming platforms that once sought to disrupt the traditional ecosystem are returning to their roots. And for those trying to watch their favorite shows, that means more ads, more price hikes, and more password-sharing crackdowns are on the horizon.

Michael Fassbender looks out a window which reflects a church in The Killer for Netflix ad tier update article

Netflix’s update does have some good news for users, though. In an effort to enhance the member experience, Netflix has “upgraded the feature set of our ads plan to include 1080p versus 720p video quality, two concurrent streams, and downloads to become available by the end of this week. All members of the ad-supported plan will be able to download their favorite series and movies, making Netflix the only ad-supported streamer to offer downloads.” Downloads are a convenient facet of Netflix’s offerings, so it’s nice that ad-tier users will get that ability back.

Additionally, Netflix notes that it has developed a new “binge ad (wt) format.” Essentially this means that “after watching three consecutive episodes, members will be presented with a fourth episode ad-free.” Netflix has always based itself partially on a model of continuous viewing. We suppose this is good news if you were intending to watch a whole series in one sitting already.

As streaming shenanigans continue to occur, it will be interesting to see if these new developments are actually sustainable.

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