Netflix May Launch Free Ad-Supported Tier in Asia and Europe
Netflix is preparing to make a significant change to its subscription model, introducing a free, ad-supported plan in select Asian and European markets. This initiative is part of Netflix’s strategy to grow its user base and compete with local free TV providers. It aims to attract a wider audience by providing free access to its vast content library. Users will not need to pay for access to Netflix content and will be able to watch anything on the platform for free, albeit with advertisements, if this plan is implemented in India.
Netflix is launching free, ad-supported plan in Asia and Europe
A Bloomberg report claims that Netflix’s initiative is aimed at areas where free television networks with advertising are already widely available. According to the report, Netflix is just beginning to talk about this possible relocation. A free service with a restricted content selection was previously tested by the company in Kenya; however, that initiative was eventually abandoned. According to people with knowledge of the situation, the goal of this approach is to draw in more users and strengthen Netflix’s position against local free TV providers.
It is anticipated that the free tier will operate on a similar principle, offering a limited and curated library by concentrating on developed markets rather than developing ones, like Germany and Japan. Additionally, there’s a chance that the streaming resolution will decrease and that the number of ads will rise. The streaming service provider’s strategy to target expanding markets, which generate the majority of its revenue, is also highlighted in the report.
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What does it mean for advertisers?
Advertisers anticipate that the launch of a free plan will greatly increase viewership, which will increase Netflix’s ad revenue. The business is also working hard to create its own advertising technology platform, which it plans to introduce by the end of 2025. It is anticipated that the platform will provide advertisers with sophisticated tools for buying ads, obtaining data, and assessing the effectiveness of their campaigns, thus improving their overall advertising experience.
According to reports, Netflix’s ad-supported tier has seen a stunning increase in usage, with 40 million monthly active users worldwide—a sharp increase from five million users annually. This sharp increase highlights how well Netflix’s strategy of luring new customers with more affordable plans has worked. The business reportedly has no plans to introduce this free option in the US, where demand for its current models is already almost at capacity.
Netflix’s decision to launch a free, ad-supported tier
Amid fierce competition in the streaming market, where businesses are progressively providing bundles to entice users, the ad-supported tier is expanding. Netflix has made some adjustments to stay competitive, such as tougher policies against password sharing and price increases for multiple subscriptions. Since its November 2022 launch, Netflix’s ad-supported tier has seen significant growth in popularity, with 40% of all new sign-ups in countries where it is eligible. Netflix has announced plans to work with top players in the industry, including The Trade Desk, Google Display & Video 360, Magnite, and Microsoft, to improve user engagement and streamline automated ad buying. This tactical move seeks to provide customers creative ways to buy ads effectively.
In an ongoing effort to improve its advertising capabilities, Netflix has stated that it plans to launch an internal advertising technology platform by the end of 2025. With this initiative, clients will have access to cutting-edge tools for buying ads and increasing user engagement. At $6.99 a month, Netflix’s ad-supported subscription offers a competitive option compared to other streaming services.
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Netflix’s Ad-Supported Tier Hits 40M Monthly Active Users Globally
Netflix’s ad-supported tier has passed a new benchmark. Up from 5 million a year ago, the ad tier now has 40 million monthly active users worldwide. In the 12 countries where it is available, the plan accounts for more than 40% of new streamer sign-ups. Along with these updates to the ad tier, the company also unveiled its own internal adtech platform.
Netflix’s ad-supported tier hits a milestone
With over 70% of its ad-supported users watching Netflix for more than 10 hours a month, Nielsen reports, Netflix took a moment during its upfront presentation at Pier59 Studios, where it’s also hosting a two-day experience with rooms themed after popular series, to brag about how engaged its users are. In addition, it claimed that viewers are twice as likely to respond to an advertisement three hours into a show as they are when they first start, in contrast to other streaming services and linear TV.
It appears that Netflix’s move into an ad-supported business model has been successful. Across all tiers, there were 270 million users of the service as of April. Furthermore, Netflix reported that over 40% of new users were registering for the ad-supported tier in areas where advertisements are available. The streamer anticipates that its upcoming platform will give advertisers new perspectives on impact measurement and purchasing strategies. To accommodate new partners like Google’s Display & Video 360, Magnite, and The Trade Desk, Netflix is also currently growing its buyers’ market.
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Netflix to introduce in-house ad tech platform
Netflix announced its intention to introduce “an in-house advertising technology platform” along with the milestone. “Bringing our ad tech in-house will allow us to power the ads plan with the same level of excellence that’s made Netflix the leader in streaming technology today,” stated Amy Reinhard, president of advertising at Netflix. Co-CEO Greg Peters stated during Netflix’s most recent earnings report that “plenty more” needs to be done to “realize the potential” in the ad tier. The company also revealed many upcoming projects, including a renewal for 3 Body Problem, in addition to the ad tier updates.
NFL Christmas Day games on Netflix
The announcement of Netflix’s intention to expand into live events coincides with the news that streaming rights for NFL games on Christmas Day have been acquired. This comes after several live comedy specials and will soon be joined by weekly WWE broadcasts and a boxing match involving Jake Paul and Mike Tyson. Additionally, it coincides with a period in which Netflix and its rivals have begun to resemble traditional cable TV due to price increases and bundles
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Upcoming series and movie lineup
Ted Sarandos, the other co-CEO of Netflix, was very transparent about the initial looks and teases of the shows the company would be showcasing before its upfront event. These included Ryan Murphy’s Monsters: The Lyle and Erik Menendez Story, Cobra Kai, Emily in Paris, Outer Banks, The Night Agent, and Season 2 of Squid Game, which Sarandos referred to as “our big one.” The Waterfront, Rising: Simone Biles, and untitled projects about Olympic Men’s Basketball, a Tim McGraw-led drama, and a Dallas Cowboys docuseries are among the new series the company has announced.
A sequel starring Adam Sandler as Happy Gilmore and a Kathryn Bigelow film were among the new releases that were announced at the same time. The news rounds out Netflix’s big news day, which also featured the previously reported Christmas NFL deal. The three-year deal is expected to transform the TV industry and position the streamer as a top competitor for upfront TV funding.
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