Netflix Pushes Back Against Speculation Regarding Ad-Tier Launch Date, Ad-Rates
Netflix is apparently tired of the growing chatter regarding the launch of its ad-supported tier. The speculation has grown in recent days thanks to reporting from the Wall Street Journal, as cited by Deadline.
The Journal spoke to unnamed ad buyers who have been in talks with Netflix, and those sources report that the streamer is asking for a CPM (cost per mil) rate of $65. CPM is an industry term which means that the asking price for putting ads in front of 1,000 customers eyes is $65, and Netflix may raise that amount to $80 once its ad-supported tier is well-established. One unnamed advertiser said that those numbers were “significantly higher” than what other streaming companies were asking for.
In a statement to Deadline, a Netflix spokesperson said, “We are still in the early days of deciding how to launch a lower-priced, ad-supported tier, and no decisions have been made. So this is all just speculation at this point.”
That statement is clearly not a denial that Netflix’s current asking price for ads is as high as reported. Netflix sees itself as the premiere destination for streaming customers, and there are numbers to back that view up. The streaming giant currently boasts 221 million customers, and generates four times the demand for its original series as the next closest competitor Prime Video.
The Wall Street Journal report also states that although Netflix has stated that the goal is to launch the ad-supported tier in early 2023, the true target date for the launch is Nov. 1, which lines up with Bloomberg reporting from last month. With estimates suggesting that Netflix’s ad-supported tier could bring in $5.5 billion globally by 2027, there’s definitely incentive for the company to launch the option earlier than planned.
Though Netflix may not like it, speculation regarding its ad-supported tier will continue until more details are officially confirmed or denied by the company. The speculation has only seemed to open the door to new unconfirmed reports. A recently, articles have suggested that customers should expect a price point of $7 to $9 per month for the ad-supported tier. Another report shows that customers probably won't be able to download shows and movies to watch offline with the ad-supported tier like they can with the current ad-free option.
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