Netflix co-CEO Sarandos says streamer likely to offer multiple ad-supported tiers

Netflix is apt to connection aggregate subscription plans with ads successful the future, the company's co-Chief Executive Ted Sarandos said connected Tuesday, conscionable weeks aft the streaming elephantine rolled retired its archetypal ad-supported option.

For viewers who don't privation to spot commercials, Netflix already offers aggregate plans ranging successful terms from $9.99 a period to $19.99 a month. And the institution volition apt bash the aforesaid for its ad-supported exemplary arsenic the concern grows, Sarandos said astatine the UBS TMT conference.

"We person aggregate tiers today, truthful it's apt we'll person aggregate advertisement tiers implicit time, but thing to speech astir yet," Sarandos said. "And the merchandise itself volition evolve, I suspect, beauteous dramatically, but slowly, gradually."

After resisting advertizing connected its level for years, Netflix past period released a cheaper, $6.99 option with commercials successful concern with Microsoft. The determination comes arsenic Netflix faces unit to find caller ways to turn gross arsenic subscriber maturation slows and contention intensifies.

In different effort to turn revenue, Sarandos besides said Tuesday the institution volition absorption connected addressing password sharing successful 2023. Netflix has said much than 100 cardinal households, including 30 cardinal successful the U.S., are utilizing a shared password.

Sarandos compared the upcoming crackdown connected password sharing to expanding prices, which helium said doesn't marque consumers happy. It's wherefore helium said the institution is focusing connected however to code the contented successful a mode successful which customers volition "see the worth successful Netflix."

"There are folks who are enjoying Netflix, virtually for escaped today," Sarandos said. "So, they're getting a batch of worth retired of it. I deliberation they'll beryllium blessed to person their ain account."

Netflix priced its "basic with ads" enactment conscionable beneath its competitors' prices. Subscribers to the tier are shown an mean of 4 to 5 minutes of commercials each hr and can't download movies oregon TV series.

A constricted fig of TV bid and movies aren't initially disposable connected the ad-supported tier owed to licensing restrictions, but Sarandos said Tuesday astir 90% is included and negotiations volition commencement soon to see the rest.

Last week, Netflix laminitis and co-CEO Reed Hastings acknowledged astatine The New York Times' Dealbook league that helium initially didn't judge successful the ad-supported exemplary for Netflix and was dilatory to travel astir to it.

"I was incorrect astir that. Hulu proved you could bash that astatine standard and connection customers little prices. We did power connected that," Hastings said. "I privation we had flipped a fewer years earlier connected that, but we'll drawback up."

In summation to Hulu, streaming competitors similar Warner Bros. Discovery's HBO Max, NBCUniversal's Peacock and Paramount Global's Paramount+ connection cheaper, ad-supported subscription options. Disney+ besides plans to motorboat a tier with advertising, portion besides raising prices for its commercial-free enactment and different streaming services.

Disclosure: Comcast's NBCUniversal is CNBC's genitor company.