A report today from financial services giant Bloomberg claims that Netflix has hit a price point for its new ad-supported tier, offering it at about half of what its current and most popular commercial-free plan charges.
The report claims that Netflix is targeting a $7 to $9 fee, a substantial discount from its current $15.49 monthly plan. The new level would be the first Netflix programming to be ad-supported.
Netflix will reportedly have four minutes of commercials per hour before and during some shows, but not after.
The ad option will debut in the last three months of this year in half a dozen test markets, Bloomber reports. A full launch will happen early next year.
Netflix executives have admitted that subscriber losses are driving Netflix toward more advertising. Bloomberg estimates that the new ad tier will generate $8.5 billion per year by 2027, a total that reflects subscriptions and ad sales.
Term has reached out to Netflix for a response on this report, but has not yet received a response.
Dade Hayes contributed to this report.