The Netflix Dilemma - Ads or increase the monthly subscription

Imagine watching Netflix "Designated Survivor," "Ozark," or "Bird Box" with interruptions in ads for deodorants and cars. These ads will break the pleasure of customers who pay for $ 8.99 per month.

It is quite possible that the idyll of continuous films, TV shows and live events will soon stop. A number of media experts and analysts who track the company's business practices believe Netflix will not ignore long-term revenue from ads that may potentially accumulate. Even that means losing some of their customers.

Netflix has around 150 million subscribers, and this is an unprecedented opportunity for advertising exposure. 60 million subscribers are only in the United States. This is twice as many people as the last episode of The Big Bang Theory. Netflix have the potential to attract a lot of ad flow, which is currently on traditional TV.

After all, Netflix will start putting ads because they will need that revenue. Analysts believe that this will be the necessary move to raise revenue, otherwise they will have to raise monthly fees again. Netflix has invested or will invest billions of dollars in original programs and productions. Actually Netflix is ​​in "direct war" with Amazon Prime, the new Disney streaming service and even TV channels such as HBO or Showtime. And to further exacerbate the situation, Apple is likely to become Netflix's main competitor. And studies show that people will not subscribe to more than one or two streaming services.

In order to improve the company's accounts, management may also decide to raise the cost of the monthly subscription. A raise to $ 9.99 or $ 10.99 is an option. But the risk here is the loss of millions of subscribers. Netflix is ​​currently in a financial trap. And the company has increased its debt by another $ 2 billion.

The company also pays tens of thousands of dollars to studios and television companies for most of their productions, and the Netflix library includes more than 100 best movies of all time.

Photo: Flickr

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