Streaming and entertainment giant Netflix, Inc. (NASDAQ:NFLX) is starting its much-awaited ad-tiered streaming plans at $6.99 per month in November. The plan with advertising is pegged to be cheaper than the one without it. Netflix hopes to attract new customers and win back lost customers through the launch.
There will be about four to five minutes of commercials every hour that will be played both before and during the content. According to the WSJ report, each advertisement will last between 15 and 30 seconds.
The ad-supported business, labeled “Basic with Ads,” will initially be offered in 12 countries and will be launched in stages between November 1 and 10. This new plan will have lower resolution compared to Netflix’s other premium plans and a limited library of content. Also, viewers will not be allowed to download any content.
Not just Netflix, even advertisers seem to be excited about the ad-tiered plans, as the company said that most of its ad blocks were sold. Furthermore, Netflix has partnered with DoubleVerify Holdings (DV) and Integral Ad Science Holding Corp., to verify viewership and analyze audiences.
Is Netflix a Buy, Sell, or Hold?
With sequential quarters of subscriber losses, analysts have awarded NFLX stock a Hold consensus rating on TipRanks. This is based on ten Buys, 15 Holds, and five Sells. The average Netflix stock prediction of $244.13 implies 5% upside potential to current levels.
With the launch of its ad-support streaming plans, Netflix aims to win back its lost sheen. Stiff competition in the space, alongside a tough macroeconomic backdrop, is pressuring the company’s performance. Year to date, NFLX stock has lost 61.1%.
