A key factor in the selection of Microsoft is its finalized acquisition of AT&T’s Xandr ad-tech unit in June, Xandr does programmatic advertising.
The company has struggled with falling profits and a massive loss of subscribers. In the first quarter, Netflix said it lost 200,000 subscribers; in the second quarter, it expects to lose 2 million more.
Netflix originally announced its intentions for an ad-supported plan back in April during its Q1 2022 earnings interview. In exchange for rolling out ads, Netflix is looking to offer cheaper, more affordable options to consumers. Given that the company lost somewhere in the vicinity of 200,000 subscribers in Q1 2022, Netflix is hoping this move will help stop the bleeding. It’s been an up-and-down year for the streaming service, as it rolled out a new Netflix Games department and has a full lineup of licensed and original programming ready for the months ahead. However, on top of the subscriber loss, Netflix has also laid off hundreds of employees over the past few months across two separate firing waves.
Netflix has seen much success with its most recent season of Stranger Things. The fourth season of the 80’s sci-fi horror show became the first English-language Netflix show to surpass a billion hours of watch time. The only show that’s beaten it is Squid Game, which had the biggest series launch ever for Netflix.
Netflix was in consultation with other prospective partners such as Google to become its official advertising partner.
No official date for the launch of this tier was formally announced. It is however expected that the ad-supported pricing tier is expected to be released sometime later this year.