Netflix is reportedly considering offering a free tier, in a bid to attract new users and further increase its user base. This is according to Bloomberg, citing “people familiar with its plans” for the information.
While Netflix is apparently toying with the idea, the report makes clear that the United States is not one of the locations where a free tier could roll out. Although that won’t be the news those based on the United States and looking to save on the cost of streaming will want to hear, it is not all that surprising.
In terms of potential subscribers, Netflix is considered to have largely achieved its full potential in the United States, and that makes it a less appealing market to launch a free tier. With far fewer new users to appeal to in the U.S., a free tier is more likely to hurt its existing subscriber base than help it.
Instead, the report indicates Netflix is more interested in focusing a potential free tier on areas like Europe and Asia, where there are still plenty of new users to appeal to. Even more specifically, countries where there are already established free TV networks.
If the company was to roll out a free tier, it would be fully reliant on ads. Similar to free services in general, this would also likely mean a much greater use of ads than what’s encountered with the existing Standard with ads plan. Lowering the price to free would also likely result in more advertising inventory in general.
It is worth keeping in mind that the report repeatedly makes clear that Netflix is only considering the possibility of a free tier at the moment, so there is no suggestion that one will actually roll out anywhere or anytime soon.
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