Ted Sarandos, co-CEO of Netflix, has just confirmed what had become an open secret. Yes, Netflix will launch a new formula with advertising. That was to be expected.
As you may know, Netflix lost 200,000 subscribers in the first quarter of 2022. A first in the history of the streaming platform. To prevent this exodus from increasing, Netfix mentioned the implementation of several measures. For example, it would be a question of broadcasting live programs, or even of modifying the rhythm of broadcasting of series by offering only one episode per week instead of the entire season.
Another idea put forward by the service: the launch of a subscription with advertisements, offered at a lower cost than the already existing formulas. However, the thing was not yet official, since this information came from an internal note sent to Netflix employees.
Netflix CEO Confirms Ads Are Coming
Never mind, Ted Sarandos, Co-CEO of Netflix alongside Reed Hastings, has just confirm the thing on the stage of the Cannes Lions, the international festival of creativity. The boss said he hopes to win a “large customer segment” with this formula with pubs. He also recalled that it will be a separate offer. In other words, subscribers to current plans won’t start getting ads in the middle of their Stranger Things episode.
“We’ve left out an important customer segment, which is people who say, “Hey, Netflix is too expensive for me and I don’t mind advertising.” We are adding a level of advertising, we are not adding advertising to Netflix as you know it today. We’re adding an ad level for people who say, ‘I want a lower price and I’ll watch the ads’. explained Ted Sarandos on the Cannes Lions stage.
Unfortunatelythe boss did not give any further explanation or details on this new formula. He simply made it clear that he was particularly optimistic about the company’s prospects, assuring that Netflix “has a lot of scale, profitability and cash flow (editor’s note: cash flow) free to continue to develop his activity”.