After only a couple of months of availability, Netflix seems pleased with early returns on the streaming service's new ad-based tier. Company executives believe the low-priced subscription option--$7 monthly in the United States--could bring in over $3 billion each year in the future.

Deadline reports that Netflix co-CEO Greg Peters talked about the success of the ad-based tier during the company's fourth-quarter earnings interview. He said growth of the new cheap option is "solid," bringing in new subscribers instead of current members switching. Additionally, their engagement matches what's seen from higher-paying customers so far.

"We're just getting started," Peters said. "We're constantly improving, and we see the trajectory ahead of us."