Netflix names Microsoft as technology and sales partner for ad-supported subscription

Netflix said Wednesday it has selected Microsoft as its technology and sales partner for its planned ad-supported subscription offering, as the streaming giant aims to halt slowing subscriber growth by rolling out a cheaper plan.

Shares of Netflix rose 2 percent to $178.06 (nearly Rs. 14,100) on the news.

Netflix announced in April that it would introduce a new, cheaper version of its service to attract more subscribers. The announcement came as the groundbreaking subscription service posted its first subscriber loss in more than a decade and predicted even bigger losses to come.

Chief Operating Officer Greg Peters said in a blog post that Netflix chose Microsoft for its ability to innovate over time and for its strong privacy protections.

“It is still very early and we still have a lot to process. But our long-term goal is clear. More choice for consumers and a premium, better than linear TV brand experience for advertisers,” said Peters.

Microsoft President Brad Smith has served on Netflix’s board of directors since 2015.

Microsoft also announced the news in a blog post stating that “consumers will have more options to access Netflix’s award-winning content at launch.”

Earlier on Wednesday, it was reported that Netflix is ​​looking to modify its programming agreements with Hollywood studios to allow for the streaming pioneer’s launch of an ad-supported version of its service, according to a The Wall Street Journal report.

The company has begun talks with Warner Bros., Universal and Sony Pictures Television, the report said, citing people familiar with the matter.

It will also have to renegotiate deals for legacy television shows such as Sony’s Breaking Bad and Paramount Global’s NCIS, according to the report.

Netflix told Reuters it’s still in its infancy to decide how to launch a cheaper ad-supported option, adding that it’s all just speculation at this point.

Warner Bros., Universal and Sony did not immediately respond to requests from Reuters for comment.

Earlier in June, co-CEO Ted Sarandos said Netflix is ​​in talks with several companies for ad partnerships.

© Thomson Reuters 2022