Netflix on Wednesday announced that will partner with Microsoft for its planned lower-priced ad-supported streaming tier. Microsoft will handle ad sales for the streamer.
Here is what Netflix COO Greg Peters said today:
“In April we announced that we will introduce a new lower priced ad-supported subscription plan for consumers, in addition to our existing ads-free basic, standard, and premium plans. Today we are pleased to announce that we have selected Microsoft as our global advertising technology and sales partner.
“Microsoft has the proven ability to support all our advertising needs as we together build a new ad-supported offering. More importantly, Microsoft offered the flexibility to innovate over time on both the technology and sales side, as well as strong privacy protections for our members.
“It’s very early days and we have much to work through. But our long-term goal is clear: More choice for consumers and a premium, better-than-linear TV brand experience for advertisers. We’re excited to work with Microsoft as we bring this new service to life.”
We reported in May that the streamer could debut its much-expected cheaper, ad-supported tier of service sometime before the end of 2022, the streamer told employees in an internal note.
While Netflix had in the past said it would not offer a lower-priced ad-supported tier, the company changed its corporate mind following a disappointing first quarter of 2022. Netflix lost subscribers for the first time in 10 years and saw its revenue growth slow considerably. The streamer blamed the downturn on “a large number of households sharing accounts” and “competition.”