Netflix sets price for its new plan with adverts

Netflix says its ad-supported plan will cost A$6.99 ($8.75) per month, and launch on November 3 in 12 countries, including the US and Australia.

There is no date set for New Zealand at this stage, a spokesman told the Weekend Herald. But Netflix operates Australia and New Zealand as one business unit so it might not be far off. It costs $12.99 to $24.99 per month for Netflix in NZ today, depending on the number of screens and whether you get frills like 4K ultra-high definition.

The new Netflix Basic With Ads account will feature:

● Ads of 15 or 30 seconds in length, shown before and during shows and movies

● An average of 4 to 5 minutes of ads per hour

● No ability to download content

● No 4K

● Video quality will top out at 720p standard high definition

● A smaller selection of content Around 10 per cent of Netflix’s catalogue of TV series and movies will be missing.

Netflix has taken a different tack from Disney+, which will introduce ads for plans on its current pricing in December, then introduce a new, more expensive ad-free tier.

The streaming giant earlier told ad buyers it expects Netflix Basic With Ads will have a global audience of 40 million by the end of its first year, according to a Wall Street Journal report — a figure that implies plans for a global rollout following the initial dozen countries.

Netflix added yesterday that it will allow advertisers to target different countries, and genres, and give them the ability to “prevent their ads from appearing on content that might be inconsistent with their brand (e.g. sex, nudity or graphic violence)”.

The firm, which has been secretive about audience numbers for individual shows, says it will work with Nielsen in the US to deliver statistics to clients.

And worldwide, streaming is a rising force.

Amazon has more than 200 million subscribers to its Prime service, which includes delivery, plus music and video streaming.

Disney’s three streaming services (Disney +, Hulu and ESPN+) added 14 million subscriptions in the June quarter for a total of 221.1 million worldwide — a nose ahead of Netflix, which lost 1 million to finish the quarter on 220.1 million.

Netflix has flagged to the market that it expects to report a return to growth for its September quarter, however.

According to the Wall Street Journal, Netflix wants to charge a CPM (cost per 1000 views of an ad) of US$65, buyers said, which is described as “substantially higher than most other streaming platforms” and more than three times the rate charged by the major social media platforms.

Netflix wants brands to commit to a yearlong upfront ad buy, the Journal says, but has also set a US$20 million annual spending limit to avoid ads for any given brand becoming too repetitious.