Comcast subsidiary NBCUniversal and Google are “top contenders” to run ads on Netflix when the streaming service rolls out its planned ad-supported tier, The Wall Street Journal reported Wednesday. Netflix “is still in the early stages of strategizing and has explored a series of tie-ups in recent weeks,” the WSJ wrote, citing people familiar with the matter.
A deal with NBCUniversal would likely mean “Comcast’s video advertising unit, FreeWheel, would provide technology to help deliver ads, while NBCUniversal’s ad sales team would help sell ads in the U.S. and in Europe,” the report said. Google, owned by Alphabet, of course has plenty of experience serving ads, including on its own YouTube and YouTube TV video platforms. Netflix already uses Google’s ad buying tools.
A deal with NBCUniversal or Google would likely be exclusive, according to the WSJ report. Comcast/NBCUniversal and Google aren’t the only contenders, as “Roku has also had preliminary discussions with Netflix about advertising partnerships,” the report says. The News reported last week that Netflix executives recently “met with representatives from Roku and Comcast to discuss agreements under which these companies would manage either ad sales or the technical infrastructure for the next level of Netflix’s ad-supported service”.
Netflix “is looking to start running pre-roll ads, which air before a show begins, in the fourth quarter,” The Information report said. Netflix also negotiates with entertainment companies to put ads in shows that Netflix doesn’t create itself. Licensing TV shows and movies for ad-free and ad-free streaming will cost Netflix about 20% more than ad-free streaming alone, according to the information report.
A Netflix spokesperson told both the WSJ and The Information that the company “is still in the early days of deciding how to launch a cheaper, ad-supported option, and no decision has been made. socket”.
Netflix resisted ads for years
After many years of resisting ads, Netflix CEO Reed Hastings announced the plan for an ad-supported tier in April. Netflix’s share price fell 35% on the day of this announcement, and Netflix’s revenue growth slowed due to a loss of subscribers.
Netflix says it will continue to offer ad-free streaming alongside a cheaper ad-free option. Netflix prices in the US currently range from $9.99 to $19.99 per month.
While Hastings initially said an ad-supported tier is something “we’re trying to figure out over the next year or two,” Netflix later told employees that it plans to roll out the ad-supported tier. by the end of this year.
Netflix would widely roll out additional fees for sharing accounts with people from other households around the same time. These fees are already charged in Chile, Costa Rica and Peru, but not in the rest of the approximately 190 countries where Netflix offers streaming.