Netflix Will Have Commercials Starting Later This Year

For a long time, Netflix insisted it would never interrupt its programming with commercials. That was part of the service’s appeal. The movies were uncut and the TV shows came without breaks, the better to binge things for hours upon hours.

But that was before Netflix faced serious competition in the streaming video space, mostly from services that do offer cheaper subscriptions for programming that is occasionally broken up by ads. Netflix also lost 200,000 subscribers in the first quarter of 2022, and it’s said it expects to lose 2 million more this quarter, which has sent their stock tumbling. And so, perhaps not surprisingly, they are now looking to create a ad-supported Netflix tier — and to do it quickly.

According to a Netflix memo to employees reported by The New York Times, Netflix plans to introduce its cheaper tier with commercial interruptions “by the end of the year.” The move will presumably boost subscriptions, and the ads will generate revenue as well.

There was a period not that long ago when a Netflix subscription was one of the best deals in entertainment. For a couple bucks a month, you got access to an enormous and varied library of movies and shows, all available instantly. But in the last few years, Netflix’s library has shrunk, and a lot of their more recent originals are just not on par with the content they lost.

Plus their subscription prices have continued to rise; their “Standard Plan” now costs a whopping $15.49 a month. That’s still cheaper than most cable packages, but when you factor in how often you use the service — and how many families feel the need to supplement it with other services like Hulu or Disney+ or HBO Max — you start to see why they might have lost a few subscribers recently.

A cheaper tier with some ads will likely attract some lapsed customers back. And if you don’t want the ads, you can continue to pay more to watch without them. But beware: according to the Times, Netflix is also planning to crack down on password sharing by the end of the year as well. So if you’re freeloading off your parents’ Netflix account, those days might be numbered.