Earlier in April, Netflix announced that it’s working on bringing a lower-priced ad-supported subscription tier, which will be added to its three existing ad-free plans. On Thursday, the streaming giants announced that they’re partnering with Microsoft to bring ads to the tier.
Microsoft becomes Netflix’s global advertising technology and sales partner of Netflix and will help them build the ad-supported plan. To put it plainly, all the advertisers will have to buy the ad slots exclusively through Microsoft.
“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.” said Greg Peters, CEO and CPO, Netflix.
Netflix currently has three paid ad-free plans — basic, standard and premium — available globally. They even have a separate mobile plan available in India and started testing a pay-to-share model in Chile, Costa Rica and Peru earlier in March. They’ve also tested with free launches in the past, offering several titles for free before charging people.
The California-based streaming service has been consistently innovating over the past few years in the face of constantly growing rivals battling for market share. In addition to their dozens of Originals and other IPs, last year Netflix also introduced gaming titles to its portfolio and acquired fiction IP.
“This is a big day for Netflix and Microsoft. We’re excited to offer new premium value to our ecosystem of marketers and partners while helping Netflix deliver more choice to their customers,” said Mikhail Parakhin, President, Web Experiences, Microsoft.
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