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Netflix is rolling out a new ad-based subscription tier, and it might not include the platform’s entire library of content. Netflix co-CEO Ted Sarandos said as part of the company’s latest earnings briefing that, at least of right now, the plan is for most–but not all–of Netflix’s content to be available.
“Today, the vast majority of what people watch on Netflix, we could include in the ad supported tier today,” Sarandos said (via IGN). “There are some things that [wouldn’t be included], that we are in conversation with the studios on, but if we launched the product today the members in the ad tier would have a great experience. And we will clear some additional content, but certainly not all of it.”
Netflix’s own programming, including Stranger Things, is sure to be included in the ad-based tier. However, The Wall Street Journal reported that studios like Warner Bros. (You, Russian Doll) as well as Sony (The Crown, Cobra Kai) are seeking higher fees–as much as 30% more–to add their programming to the ad-based tier. According to the report, Netflix will renegotiate existing deals for older shows, too, like Breaking Bad and NCIS, for the new membership tier.
This wouldn’t be the first time Netflix renegotiated rights deals with licensors, as Netflix paid outside studios an additional 10%-15% when it announced the ability to download shows.
A spokesperson for Netflix told WSJ, “We are still in the early days of deciding how to launch a lower-priced, ad-supported option, and no decisions have been made.”
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Netflix’s ad-based tier could launch by the end of 2022, but nothing is confirmed as of yet.
Netflix just announced that it lost 970,000 subscribers in the past three months. This was the largest subscriber churn in the company’s history, but it’s below the 2 million that was initially predicted.
