Netflix‘s co-CEO Ted Sarandos has ensured that the company plans to submit an ad-supported tier to its streaming service in a discussion at the Cannes Lions advertising festival.
The New York Times documented last month that the company strives to proceed out the new tier by the end of 2022.
“We’ve left a big customer piece off the table, people who say: ‘Hey, Netflix is too pricey for me, and I don’t mind advertising,'” Sarandos stated. “We [are] getting an ad tier; we’re not counting ads to Netflix as you know it today. We’re adding an ad tier for locals who say, ‘Hey, I want a reduced price, and I’ll watch ads.'”
The streaming service has been widely anticipated to launch an ad-supported subscription tier for its service ever since its other co-CEO Reed Hastings told that he’d be open to the concept in April.
Netflix’s plans to undertake the new, cheaper tier follow news that it failed subscribers for the first term in over a decade last quarter. The business registered a loss of 200,000 subscribers in Q1 2022, corresponding to the previous year’s fourth quarter. It remains an adequate streaming service with roughly 222 million subscribers, but the loss has caused Netflix to review its historically hardline stance against ads.
Now, the query is which ad-sales company Netflix will partner with to allow it to enter the advertising business. Earlier this month, the Wall Street Journal conveyed that NBCUniversal and Google were two top competitors. When asked during the Cannes discussion, Sarandos wouldn’t be drawn on who Netflix might partner with but suggested the company could use a partnership as an interim measure. At the same time, it drives out its own ad business, according to the WSJ.
Sarandos was also questioned if Netflix’s tanking share price could make the company the takeover target. In response, the executive said it is “always a reality” but argued that the company has everything it needs to yield growth under its own steam. He also ignored recent rumors that Netflix could be looking to purchase a streaming hardware company like Roku. “We don’t need it,” Sarandos said.
Netflix’s objectives for a cheaper, ad-supported tier mirror those of rival Disney Plus also hopes to launch a similar offering by the end of the year. Disney’s ad-supported tier will come to the US first before expanding internationally in 2023, and the company plans to limit ads to four minutes per hour. Pricing for both Netflix and Disney’s new tiers is yet to be announced.
Netflix, Inc. is an American subscription streaming courtesy and production company. Launched on August 29, 1997, it delivers a film and television series library through distribution deals and its productions, understood as Netflix Originals.
As of March 31, 2022, Netflix had more tha 221.6 million subscribers globally, including 74.6 million in the US and Canada, 74.0 million in Europe, the Middle East, and Africa, and 39.9 million in Latin America, and 32.7 million in Asia-Pacific. It is available globally aside from Mainland China, Syria, North Korea, and Russia. In addition, Netflix has played a notable role in independent film distribution and is a Motion Picture Association (MPA) member.
Netflix can be accessed through an internet browser on computers or via application software installed on intelligent TVs, set-top boxes connected to televisions, and smartphones. In addition, it has digital media players, tablet computers, Blu-ray Disc players, video game consoles, and VR headsets on the list of Netflix-compatible devices. It is available in 4K resolution. In the US, the company provides DVD and Blu-ray rentals delivered individually via the United States Postal Service from regional warehouses.
Netflix was founded on the previous date by Reed Hastings and Marc Randolph in Scotts Valley, California. Netflix initially sold and rented DVDs by mail, but the sales were stopped within a year to focus on the DVD rental business. In 2007, Netflix submitted streaming media and video on demand.
The company extended to Canada in 2010, followed by Latin America and the Caribbean. Netflix entered the content-production initiative in 2013, debuting its first series House of Cards. In January 2016, it expanded to 130 countries and then served in 190 nations.
The company is ranked 115th on the Fortune 500 and 219th on the Forbes Global 2000. It is the second largest entertainment/media company by market capitalization as of February 2022. In 2021, Netflix was ranked as the eighth-most trusted brand globally by Morning Consult. During the 2010s, Netflix was the top-performing stock in the S&P 500 stock market index, with a total return of 3,693%.
Netflix is headquartered in Los Gatos, California, in Santa Clara County, with the two CEOs, Hastings and Ted Sarandos, split between Los Gatos and Los Angeles, respectively. It also operates international offices in Asia, Europe, and Latin America, including Canada, France, Italy, Japan, South Korea, Brazil, Netherlands, India, and the United Kingdom. In addition, the company has production hubs in London, Madrid, Vancouver, Los Angeles, Albuquerque, and Toronto. Compared to other distributors, Netflix pays more for TV shows upfront but keeps more “upside on big hits.
Netflix can be accessed via an internet browser on PCs. At the same time, Netflix apps are available on various platforms, including Blu-ray Disc players, tablet computers, mobile phones, smart TVs, digital media players, and video game consoles (including Xbox 360 and newer, and PlayStation 3 and more unique). The Wii, Wii U, Nintendo 3DS, and PlayStation 2 were formerly compatible with Netflix.
In addition, a growing number of multichannel television providers, including cable television and IPTV services, have also added Netflix apps accessible within their set-top boxes. It sometimes with the ability for its content (along with those of other online video services) to be presented within a unified search interface alongside linear television programming as an “all-in-one” solution.
4K streaming requires a 4K-compatible device and display, supporting HDCP 2.2. In addition, 4K streaming on personal computers involves hardware and software support of the Microsoft PlayReady 3.0 digital rights management solution, which requires a compatible CPU, graphics card, and software environment.
Currently, this element is limited to 7th generation Intel Core or later CPUs, Windows 10, Nvidia GeForce 10 series, AMD Radeon 400 series, or later graphics cards, and running through Microsoft Edge web browser or the Netflix universal app available on Microsoft Store.