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Netflix taps Microsoft to build its ad-supported subscription tier. Will we see it this year?

Netflix has parterned with Microsoft to build its ad-supported subscription tier which is likely to be rolled out towards this year’s end

Source: Netflix

Netflix’s plan to introduce ads will be brought to fruition by Microsoft after the streaming company appointed the latter as its “global advertising technology and sales partner”, the streaming giant said in a press release. The partnership will help Netflix build an ad-supported plan which will be offered to consumers at a lower cost and shore up its subscriber base. Why it matters: Netflix changed its stance on ad-supported tiers for the first time this year after years of avoiding advertisements on its platform. It was forced to pivot after it reported a loss of subscribers for the first time in a decade. The partnership is significant as Netflix would have found it difficult to build an ad unit from scratch. It also indicates that the company will be rolling out the plan shortly. What will this deal mean for Netflix: The company is likely to lose some of the ad revenue by bringing on a partner, Variety explained in its report. The report added that the choice will help Netflix leverage new techniques in video advertising such as programmatic ad sales, addressable ads, etc. Netflix chose Microsoft for two reasons, The Verge revealed. The first one was the fact that Google and Comcast, two other companies in the running, have video platforms that compete with Netflix. Microsoft does not have a service. The other reason cited in the report is Microsoft's acquisition of Xandr from AT&T last year which can prove to be instrumental as Xandr is building technology for an…

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I cover several beats such as Crypto, Telecom, and OTT at MediaNama. I can be found loitering at my local theatre when I am off work consuming movies by the dozen.

MediaNama’s mission is to help build a digital ecosystem which is open, fair, global and competitive.

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