Netflix announced that its cheaper, ad-supported tier now has 40 million global monthly active users, nearly doubling the 23 million figure shared earlier in the year. The company also revealed plans to launch its own advertising platform and end its partnership with Microsoft for that technology, although Microsoft will continue to be a programmatic advertising partner. The ad-supported plan was introduced in November 2022 as part of an effort to drive revenue amidst slowing subscriber growth, which also included a password-sharing crackdown.
In countries where the ad tier is available, 40% of all signups are for the cheaper plan, leading Netflix to amass a total of 270 million subscribers worldwide. This surge in ad-tier users comes at a time when linear TV audiences are declining, and traditional media companies are trying to make their mark in the streaming landscape. Netflix has established itself as a leader in the streaming segment, despite the struggles faced by many other companies in making their platforms profitable. Key competitors like Comcast’s Peacock, for example, have far fewer subscribers than Netflix.
The decision to release the monthly active ad-tier user figures comes shortly after Netflix announced that it would no longer provide quarterly subscriber number updates. The company stated that its substantial profit and free cash flow, along with the introduction of multiple price points for memberships, made subscriber numbers less significant as a growth metric. This move reflects Netflix’s broader strategy to focus on revenue generation and diversify its offerings to appeal to a wider range of consumers.
As linear TV continues to lose viewership to streaming platforms, the competition in the streaming landscape is intensifying. Netflix’s success in attracting a large number of ad-tier users underscores its ongoing dominance in the industry and its ability to adapt to changing consumer preferences. The company’s decision to create its own advertising platform signals a shift towards greater control over its revenue streams and a more direct relationship with advertisers. By parting ways with Microsoft for advertising technology, Netflix is streamlining its operations and paving the way for new growth opportunities.
Overall, Netflix’s latest moves in expanding its ad-supported tier and launching its own advertising platform position the company for continued growth in a competitive streaming market. With a focus on driving revenue and diversifying its offerings, Netflix is cementing its position as a leader in the industry while simultaneously adapting to the changing landscape of media consumption. The company’s ability to attract a large number of ad-tier users underscores its appeal to a diverse audience and its ongoing success in meeting consumer demand for streaming content.
