Aiming to grow its subscriber base through an affordable plan, Netflix co-CEO Ted Sarandos confirmed on June 23 that the online streaming platform is working on adding a new ad-supported tier to its subscription offerings.
Sarandos, speaking at the Cannes Lions Advertising Festival, said that after losing 200,000 customers last quarter, the firm will introduce a less expensive ad-supported tier of its service to bring in new customers. ,
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“We’ve left a huge subscriber segment off the table, people who say: ‘Hey, Netflix is too expensive for me and I don’t mind advertising,'” The Hollywood Reporter quoted Sarandos as saying On the Cannes Lions stage with Self podcast host Kara Swisher.
“We’re adding an ad tier; we’re not adding ads to Netflix as you know it today. We’re adding an ad tier for people who say, ‘Hey, I want a lower price and I’ll watch the ad’ .'” Sarandos added.
The report says that Netflix’s presence at Cannes Lions is a clear sign that the company is looking to embrace the advertising industry. In addition, Sarandos confirmed that the company is in talks with potential ad-sales partners.
Although Netflix spokesperson told Engadget That the company was “in the early days” of developing an ad-based tier, and did not downplay its approach.
“We are still in the early days of deciding how to launch the lower priced, ad supported option and no decision has been taken. So at this point in time it is all just speculation,” the statement said.