Microsoft is helping Netflix bring its worst service to everyone.
Netflix ads used to be the stuff of nightmares, a frightful myth the streaming giant would rather stay clear from. Now though, times are changing, and a rough year has meant Netflix has had to change its tactics somewhat. The Hollywood Reporter writes that Netflix is likely to be bringing ads sooner than expected thanks to help from tech giant Microsoft, with the two companies forming an alliance on Wednesday.
It has been known for some time that Netflix has been planning to introduce a Netflix ads service in a bid to recover from a tough start to 2022. In order to fast track their ads service, Netflix has partnered with Microsoft, with the tech company being made Netflix’s global advertising technology and sales partner. “Microsoft has the proven ability to support all our advertising needs as we work together to build a new ad-supported offering.” Those were the words of Netflix COO and chief product officer Greg Peters. In other words, Netflix needs an ad supported service quick and Microsoft have the ability to make this a reality.
Netflix ads will be part of a lower tier service offering low hanging fruit to consumers who aren’t afraid of sitting through an ad or two in the aim of cutting back on costs. The decision to fast-track an ad-supported service on Netflix is a timely one as the streaming company has suffered one of the worst years in its short history. Subscriber numbers and stock prices have been tumbling since the new year, with Netflix losing approximately 200,000 subscribers in the first three months of 2022 alone. Such blows have led to a series of staff cuts, with 300 staff members being laid off from the company last month.
Despite the fact that subscriber numbers are dwindling and the stock market makes for scary reading at Netflix, The Atlantic writes that the streaming company is still going full steam ahead with a series of expensive blockbusters. Whereas before the streaming studio was focussing on passion projects from the likes of Martin Scorcese, Alfonso Cuaron and Adam McKay, now they’re focusing on blockbusters akin to those seen in traditional cinema. Films such as Red Notice, Army of the Dead, The Gray Man and the upcoming Knives Out 2 show a statement of intent from Netflix. Not only is the company considering Netflix ads, it is also keen on attracting subscribers with big, bombastic, star driven movies. The only problem with that tactic is, cinemas are also intent on big-blockbusters and the likes of The Batman, Top Gun: Maverick and Thor: Love and Thunder show that cinema is still king of the blockbuster, a far cry from the tumbleweed cinema era of the pandemic.
Skeptics and stock market aficionados will be wondering whether the Netflix and Microsoft partnership will prove to be successful. Are Netflix ads the thing to lift the streaming giant out from its downward spiral, or will big budget blockbusters like The Gray Man be the thing to help Netflix succeed? Only time will tell, but Netflix ads are a roll of the dice that the streaming company so desperately needs.