Netflix with ads is coming this year. Here’s what we know

Global streaming giant Netflix plans to roll out its new tier of advertising in Australia before the end of the year, a clear sign of its ambitions to boost revenue as subscriber numbers tumble.

Local media sources, who spoke on condition of anonymity because they are not authorized to speak publicly, said the streaming giant has entered into discussions with local advertisers about plans to roll out the ads, which will be non-skippable and pre-episode or a film will appear begins.

Netflix is ​​in the midst of its most challenging year on record.

Netflix is ​​in the midst of its most challenging year on record.Recognition:Getty Images

The service is expected to cost around $8, which is less than the price of a basic Netflix streaming subscription. Subscribers who pay full price don’t have to see ads. Sources said Netflix is ​​also considering running ads in the middle of a program as part of the new service.

A Netflix spokesman said the company is still making decisions about the launch. “We’re still in the early stages of deciding how to introduce a lower-priced, ad-supported option, and no decisions have been made yet. It’s all speculation at this point,” the spokesman said.

Netflix boss Reed Hastings said the streaming giant will start exploring a cheap, ad-based option in April after the pandemic darling reported its first drop in users in more than a decade. Plans to bring advertising into its service caught this market by surprise, as it was once fiercely opposed to the idea, but local advertising buyers said they expected strong demand.

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Local sources said the promotional tier is expected to launch in Australia as early as November and slots will only be available to domestic customers. The streaming giant has also decided not to advertise politics, gambling and cryptocurrency and will not market any products to children. It is still considering restrictions on medicines, the sources added.

Netflix said in July it would work with Microsoft to roll out the new advertising layer, and last Tuesday it said it had hired former Snap execs Jeremi Gorman and Peter Naylor to head the new advertising team. The company hasn’t revealed how much it plans to charge customers for the tier, but Bloomberg reported last week that it’s expected to be between $7 and $9 per month. Local sources suggested it will be around half the price of a current basic plan, which is $10.99.

The Wall Street Journal As reported last week, Netflix is ​​considering charging advertisers about $65 (US$95) to reach 1000 viewers, a measurement known as CPM, or cost per thousand. Local sources said Netflix is ​​basing its pricing on projections of how many people are likely to migrate to an advertising model and how many people are using the service locally.

https://www.smh.com.au/business/companies/netflix-with-ads-is-coming-this-year-here-s-what-we-know-20220902-p5bezy.html?ref=rss&utm_medium=rss&utm_source=rss_business Netflix with ads is coming this year. Here’s what we know

Brian Lowry

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