Netflix and its rivals bring back ad breaks
Canadian Netflix users will see a new membership option starting Tuesday that costs less but comes with a catch: commercial breaks inserted into their favourite shows.
After years of uninterrupted binge-watches, the world’s largest streaming service is making way for a word from its sponsors. And as inflation continues to pinch consumers, the proposal of a cheaper Netflix plan may sound enticing to some.
Netflix isn’t alone in believing commercial TV is back in a big way.
Several free ad-supported streaming services will launch in Canada over the coming weeks, all of them built on a business model that taps into the country’s multibillion advertising industry to finance and acquire programming.
Analysts say together the platforms could reshape how we watch and pay for television. More viewers are complaining that streaming costs have soared near the level of their old cable bills, which has pressured each service to reconsider its business model.
“Consumers are faced with more choice, more platforms and are making more deliberate decisions as to which streaming services they keep and which ones to cancel,” said Justin Krieger, senior technology and media analyst at consultancy firm RSM Canada.
Of the newcomers, Pluto TV debuts on Dec. 1 with more than 100 channels of free TV series, movies and sports that stream “live” online on a platform that mimics the experience of channel surfing, complete with the commercials.
Around the same time, CBC will introduce a revamped free streaming news channel that will be available on CBC Gem and multiple other streaming platforms. A flagship program hosted by Andrew Chang of “The National” will be the main attraction, with advertisements interspersed throughout the day.
South of the border, Disney Plus rolls out an ad-supported option later this year with some industry observers predicting it will apply the same model in Canada soon after. The ad tier will be introduced at the price of Disney’s existing commercial-free service. Subscribers who want to eliminate the ads will have to pay a premium.
In Canada, Netflix’s “basic with ads” plan costs $5.99 per month — less than the plans without ads, which start at $9.99 and peak at $20.99 a month.
As a tradeoff for the savings, Netflix says subscribers will be presented with an average of four to five minutes of ads per hour played before and during their TV shows and films. Video quality on the Netflix ad plan tops out at 720p, leaving full high-definition streaming at 1080p and 4K for premium subscribers.