Newsletter
Despite losing subscribers this year, for the first time ever, Netflix is still seeing a silver lining in its service. This year, it debuted its first ad-supported tier, and it looks like Netflix might be launching a second one soon. Netflix’s co-CEO Ted Sarandos was speaking at the UBS Global TMT Conference, and stated that the company is just really scratching the surface of what it means to have an ad-supported tier. Sarandos also stated that there might be additional tiers over-time. But for now, there’s nothing to talk about.
This makes sense. Since Netflix has its Basic and Basic with Ads plans. And then Standard and Premium plans. Netflix could add ads to both of those other plans as well. Which would give users more features, for less.
Netflix doesn’t see a future for “renting” sports
Even though Netflix started out by “renting” content from other studios, it doesn’t see a future in renting big sports right now. Sarandos stated that they are “not anti-sports, we’re just pro-profit. We have yet to figure out how to do it. But I’m very confident we can get twice as big as we are without sports”.
Sarandos does have a point here. Streaming rights for sports have hit some astronomical numbers lately. For instance, the Big Ten hit a new media rights contract for $7 billion over 7 years. Which is a ton of money. If Netflix were going to be the streaming home for a college conference of sports, it would really need to be worth it for them. Since Netflix doesn’t have linear channels that are available on cable for non-cord cutters.
But the real question is whether Netflix could double in size without sports. That’s a bit of a stretch. But with Netflix slowing down on content spending, and not chasing Oscar-worthy movies now, it might be possible. But they’d also need to stop canceling the good series.