[t0mas88]

YouTube 30 second preroll ads cost currently around $ 7 per 1000 views and it's decreasing. So to take Netflix from $ 14.99 to $ 7.99 per month they would have to show you around 500 minutes of ads every month. That's 33 of those 30 seconds ads every day, without skipping a day. While you still pay $ 7.99 per month as well. I don't expect consumers will accept that.

So the only way they can make an ad-supported Netflix work is to create some form of much more effective ad (which usually means taking more of your data) or attract a very specific high value audience (makes them too much of a niche player for their size)

[sib]

Premium video ads sell at much higher CPM than YouTube. Hulu makes more money from users on their "with-ads" tier than on the higher-priced "ad-free" tier.

[cwkoss]

I think a lot of people refuse to pay for an "ad-free" tier that still insists on occasionally showing ads, feels scummy.

[excalibur]

They could mess around with the amount of ad time per program and the plan price.

I think Hulu is showing at least 5 minutes of ads per 22 minute program, so watching two hours of programming would exceed the ad time you mentioned. This is reasonable for a single day, but a high bar for a daily average.

[gbronner]

Nahh... they'd just make the cheaper product obnoxiously time wasteful so most people upgrade. It doesn't have to stand on its own.