Last month, streaming giant Netflix announced a new ad-supported tier called “Basic with Ads.” Ahead of the $6.99 tier’s launch, a new report has revealed that Netflix has yet to reach an agreement with five big studios to stream their content on its ad-supported plan.
Netflix has not been able to secure new deals with content owners for its “Basic with Ads” tier
Back when rumors of Netflix working on an ad-supported tier first started circulating, it was reported that the new plan would lack some major third-party titles that are currently available in the higher-end plans.
When the streaming giant announced the new plan, it said that it would have “components of the existing Basic, Standard, and Premium plans such as an extensive library of content,” among other features. However, the Wall Street Journal recently reported that Netflix has not been able to come to an agreement with five major studios to stream their titles on its new plan: Walt Disney, NBCUniversal, Sony Pictures, Warner Bros, and Lions Gate Entertainment.
The Los Gatos, Calif., company has so far secured big-name advertisers for its initial launch and hired new senior ad industry executives to help develop its business, but it continues to haggle with several major studios for the right to run ads against their content in the new service or put their content on the ad tier, according to people familiar with the matter.
The WSJ notes that NBCUniversal is a big supplier of original and library content to Netflix, including the drama hit psychological-thriller drama “You.”
As of right now, major titles such as Grey’s Anatomy, Breaking Bad, How to Get Away with Murder, The Crown, and Cobra Kai, will not be available in the cheaper ad-supported plan.
The report cites a survey of 1,300 current Netflix subscribers conducted by Samba TV, which found that middle- and lower-income users and older subscribers are more interested in switching to the ad-supported tier than young adults.
The ad-supported tier will show an average of 4 to 5 minutes of ads will be displayed per every hour of content and it will cap streaming quality at 720p. At launch, “Basic with Ads” will be available in Australia, Brazil, Canada, France, Germany, Italy, Japan, Korea, Mexico, Spain, the United Kingdom, and the United States.