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Two of the Biggest Subscription Companies Roll Out New Features

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  • Nadine Ghica & Sabrina Mullens - SUBTA
  • Oct 19, 2022
  • 5 minute read

Two of the biggest subscription companies in the streaming industry recently announced the expansion of their respective offerings.

On Oct. 13, Netflix revealed that its ad-supported tier was set to launch on Nov. 3. A few days later, Amazon introduced Amazon Music Live, which is set to debut on Oct. 27 following the seventh edition of the company’s Thursday Night Football broadcast.  

Amazon Prime’s latest addition could lead to further growth, as the streaming service now has more than 200 million members worldwide. Likewise, Netflix’s ad-supported tier could increase its subscriber count even more as the company surpassed its projections for Q3 2022.

Read on to learn more about the latest offerings from two of the biggest subscription companies, what’s next for the streaming segment, and how listening to your customers can help you enrich your offering.

Netflix Offers Potential Customers a More Affordable Tier

Netflix’s ad-supported tier is called Basic with Ads. This new offering will be available in 12 countries starting Nov. 3 and includes: 

  • A large library of TV shows and movies
  • Personalized viewing experiences
  • Availability to stream on TV and mobile devices
  • The option to change or cancel the plan at any time

The tier — which is listed at $6.99/month, $3 less than its existing Basic tier — is “everything people love about Netflix,” according to Greg Peters, Netflix’s Chief Operating Officer and Chief Product Officer.

However, Basic with Ads differs from the other plans in a few ways:

  • Video quality up to 720p/HD (lower than other tiers)
  • An average of four to five minutes of ads per hour
  • A limited content library due to licensing restrictions
  • Inability to download content

Netflix’s latest initiative also “...represents an exciting opportunity for advertisers — the chance to reach a diverse audience, including younger viewers who increasingly don’t watch linear TV, in a premium environment with a seamless, high-resolution ads experience,” according to the press release.

Advertisers will receive added value from this new tier, as they will be able to choose which genres their advertisements would appear in, track ad performance, and measure their audiences through Nielsen’s Digital Ad Ratings (DAR).

Photo Credit: Netflix

Consumer interest has grown for advertisements in streaming, with ad-supported video-on-demand (AVOD) usage increasing by 29% in U.S. households in 2022 compared to 2020, according to Comscore.

“We’re seeing that consumers are being more mindful of their budgets and leaning towards ad-supported services,” stated James Muldrow, Vice President of Product Management at Comscore. “This makes sense as inflation continues to hit consumers’ wallets.”

Netflix is not the first streaming platform to offer an ad-supported tier. Amazon’s own AVOD service, Amazon Freevee (formerly known as IMDb TV), launched in 2019 and is set to expand its content library by 70% in 2022 after tripling its monthly active users over the last two years, according to Amazon, one of the biggest subscription companies.

Amazon Music Live to Follow Thursday Night Football

Amazon Music expanded its offering with the introduction of Amazon Music Live, which will be livestreamed through Prime Video and the Amazon Music channel on Twitch following Thursday Night Football


Photo Credit: Amazon Prime Video

Launching on Oct. 27 at 9pm EST, this new concert series will be hosted by American Rapper 2 Chainz coupled with performances from other artists in the music industry. 2 Chainz will also be interviewing these artists during Thursday Night Football, providing fans with exclusive access.

The Thursday night time slot has proven to be a popular one for Amazon — specifically Prime Video usage — as the platform outperformed broadcast and cable this past September for Thursday Night Football.

“Thursdays are the biggest night for entertainment,” an Amazon Music spokesperson told SUBTA. “Amazon Music Live is an unprecedented moment for us to bring together the best of America’s sport and the biggest pillar of our culture — music.”

What’s Next for the State of Streaming?

According to Research and Markets, Netflix is predicted to remain the top revenue earner by 2027 with $30 billion in the global SVOD market, followed by Disney+ at $15 billion. Meanwhile, Amazon is expected to reach 250 million members.

While the streaming industry continues to evolve and is projected to reach $132 billion by 2027, consumer behaviors and trends are challenging that growth. In the U.K., SVOD experienced a comeback in Q3 2022 with an increase of 108,000 subscriptions, compared to the significant drop in the previous quarter, according to Kantar.

Dominic Sunnebo, Global Insight Director of Kantar, noted that the cost of living is one factor affecting the streaming market; Netflix’s more affordable, ad-supported tier can provide added value and could be what consumers need to enjoy their favorite content while staying within budget.

Bundles are also a budget-friendly option to attract new subscribers, and they are predicted to increase in popularity. In August 2022, Walmart+ announced that its membership provided customers with access to Paramount+ at no additional cost.

Although streaming usage dropped after originally surpassing cable in July, the holidays could accelerate the segment’s growth; 40% of U.S. consumers gifted a streaming service in 2021, making the segment the most gifted subscription, according to an Attest survey conducted by SUBTA.

What You Can Learn From Two of the Biggest Subscription Companies

Amazon Music and Netflix are prime examples of how you can enhance your subscription offering through initiatives that prioritize consumers. 

Netflix’s ad-supported tier provides added value for potential customers and advertisers looking to promote their content on the streaming platform. 

Likewise, Amazon Music Live benefits more than just sports and music fans. Performing artists now have a unique stage “to share their most important new music with fans and newcomers alike,” an Amazon Music spokesperson told SUBTA. “Artists who perform on Amazon Music Live will receive in-game promotion on Thursday Night Football on Prime Video — one of the biggest weekly sports moments that routinely reaches millions of viewers.”

As a subscription business, you need to consider how you can improve your own offering and provide added value for your customers. 

In order to meet the needs of your target audience, you have to listen to your community and how they respond to your product, whether it’s by collecting customer reviews or surveying them.

“Always survey your customers. They will tell you what they want and you can optimize your offering to reduce churn,” said SubSummit Co-Founder Christopher George.

 Key Takeaways

  • Netflix’s ad-supported tier, Basic with Ads, is priced at $6.99/month, and will be available in 12 countries, starting with the U.S. on Nov. 3.
  • Amazon announced a new live music streaming offering called Amazon Music Live, which will launch on Oct. 27. It will be streamed after every Thursday Night Football, be hosted by 2 Chainz, and feature performing music artists.
  • Netflix is predicted to remain the top revenue earner by 2027 with $30 billion in the global SVOD market, followed by Disney+ at $15 billion, according to Research and Markets.

Looking for more exclusive insights and knowledge to succeed in the subscription industry? Attend the world’s largest DTC subscription conference, SubSummit, on May 31 – June 2, 2023!