There's a wider dilemma at play for Netflix. As the article points out, they've reached a point where their main product (paid streaming) has saturated the mark

There's a wider dilemma at play for Netflix. As the article points out, they've reached a point where their main product (paid streaming) has saturated the market. They won and there's not much more to be gained there. Options for their next move essentially boil down to: (a) expand into "other bets" (e.g. games) (b) compromise on the quality of their product and brand by selling ads to gain incremental revenue (c) give up on growth and be happy with a large, sustainable business They are openly pursuing (a), which is the ideal outcome. Ideally they can even launch gaming or some other form of entertainment as a separate subscription, helping to diversify their revenue. I see (b) as the backup plan. If they're not able to diversify into another revenue source, their next best bet is to compromise their existing product and extract the final bit of juice using advertising. Some number of customers will drop down from paid to free, and that number is difficult to model. Netflix could also end up shooting themselves in the foot by introducing ads, if that convinces the whole industry to do the same. In the long run that will reduce margins for all. Finally, (c) isn't compatible with the type of capitalist society we live in. Sometimes a company has peaked and that's OK.