Netflix (NFLX) will block users from downloading television shows and movies to their devices
for offline viewing as part of its new advertising-supported streaming tier.
The move to block downloading to devices was discovered in a code found inside the
company’s iPhone app and comes as Netflix prepares to launch the lower priced ad-supported
streaming tier early next year (2023).
Netflix had avoided advertising on its platform for years, but now sees ads as a way to boost
revenue amid declining subscribers.
Netflix’s ad-supported tier will provide a cheaper alternative to customers. The service’s
premium tier currently costs $20 a month in the U.S.
But indications are that Netflix plans to limit popular applications such as downloads to devices
with the new ad-based service. With its regular plans, users are able to download content for
viewing in places without internet access, such as airplanes.
The lack of the download option could help Netflix push consumers to its higher-level streaming
tiers. The Los Gatos, California-based company has already said that it won’t offer all its
available content on the new ad-supported streaming tier.
In the second quarter of this year, Netflix lost 1.3 million customers in the U.S. and Canada. The
company is losing ground to streaming competitors such as Disney+, HBO Max, and Peacock.
Netflix has announced that Microsoft (MSFT) will serve as its sales and technology partner for
the new advertising system.
Netflix stock is down 60% this year and trading at $241.15 U.S. per share.
