Netflix has taken steps to offer an ad-supported offer; the streaming giant has indeed announced that it is in discussions with various companies to implement it.
Google and Comcast in talks with Netflix
In the first quarter of 2022, Netflix lost subscribers for the first time in more than ten years, leading to an unprecedented internal crisis, including the layoff of more than 150 employees. The company is looking for ways to replenish the coffers and for this, wants to offer a less expensive advertising offer in order to attract more users. She hopes to be able to put it in place before the end of 2022.
A major agreement for the interoperability of metaverses
the wall street journal now reports that the platform is currently exploring a series of partnerships that could help it bring its plans to fruition, including with Comcast and Google. Netflix’s goal is to partner with an established player in the advertising industry to launch its offering and then develop its own in-house advertising business, which should be ” more integrated and less disruptive than traditional television advertising.
” We want a fairly easy entry into the market, which again we will build and iterate on. What we do at the beginning will not be representative of what the product will be in the end. I want our product to be better than TV “said Ted Sarandos, co-CEO of Netflix.
Netflix wants to bail out the coffers through advertising. Photography: charlesdeluvio / Unsplash
What impact of an advertising offer for Netflix?
According to New York Times, it is still difficult to predict the impact of such an offer on Netflix’s performance. If the revenues of the service could greatly increase thanks to this offer, it is also possible that the users subscribing to it are already subscribed to the more expensive offer of the platform, which would not allow it to garner a new number of subscribers. important.
Indeed, Wells Fargo analysts predicted that a cheaper, ad-supported Netflix offering would attract just over 100 million subscribers by the end of 2025. However, only 16 million of those customers would New Users: Nearly 85% of users of Netflix’s ad-supported service will be existing subscribers looking to pay less for streaming.
Netflix’s decision could also displease Hollywood. Some directors might resent having their creation overrun with ads, and it’s likely that many will want the ability to negotiate with Netflix which ads to insert and when. On the other hand, producers could also ask for a percentage of revenue generated by advertising.
Netflix is thinking about different options to get out of it
An advertising offer is not Netflix’s only proposal to make up for its losses. The platform needs to act fast, as it expects to lose more users in the coming months. Thus, Netflix has diversified by offering video games, it even wants to double its offer in this sector by the end of the year.
In addition, the service is interested in live content broadcasting and is currently testing a feature to combat password sharing, which is a major contributor to its loss of growth. For now, however, the tests of the latter are quite confusing; Netflix still plans to deploy it by the end of the year.