Netflix is today the leader in the streaming market, but its finances are not very good.
She has raised the price of her plans with some frequency in recent years and her high investment in original productions creates large debts. One way out of getting more money could be the creation of an ad-supported free access modality that has been rumoured but has been denied once by the company.
Now the Instinet institute has released a prediction that may be encouraging for the platform: an advertising-backed plan, in its own projections, could raise up to $ 1 billion annually for her coffers.
That would mean an interesting injection into revenue in a scenario where the company has debts and obligations estimated at $ 10 billion. Of course, the variables in this equation are much more complicated.
For example, the projection institute itself estimates that these values would be valid for a scenario in which only 25 percent of service users by 2021 would use the free plan. A massive cancellation of the paid modes could completely change the revenue result, as well as create a strong reliance on advertisers, which is certainly not interesting.
Netflix’s direct competitor, Hulu – now Disney – was one of the first services to create an ad usage mode. This, however, is still paid, but in values much more accessible than those of a plan without advertising.
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Remember, Netflix has been testing a Picture-in-Picture mode so users can watch their favourite movies and shows while doing other tasks.
Source: www.slashgear.com