Netflix Reportedly Meets with Google to Discuss Ad Partnership as Roku Rumors Persist
Netflix, in its announcement this spring that it had lost subscribers for the first time in years, also announced that it would launch an advertising-supported tier; something that the company had long vowed never to do.
Since then, there has been much speculation about exactly what shape the ad-enabled would take. Last week, reports began circulating that Netflix had met with Roku and Comcast/NBC Universal, to discuss a potential partnership since the streaming giant has no experience in advertising.
Then on Tuesday, CNBC reported Tuesday that Netflix has met with Google to discuss its advertising plans as well. One source told CNBC that Netflix is looking to find marketing partners in the coming months, and then “assemble a team to manage the relationship with its partners.”
It’s not clear how soon the company plans to launch the ad-supported tier, although the company has reportedly told employees it could launch as soon as the end of this year.
“We are still in the early days of deciding how to launch a lower-priced, ad-supported option and no decisions have been made,” Netflix said in a statement to CNBC. “So this is all just speculation at this point.”
Netflix co-CEO and longtime content boss Ted Sarandos was at the Cannes Lions advertising conference this week, where he will receive the Entertainment Person of the Year award and deliver a speech on Thursday. The talk was announced months ago before it was known that Netflix was making an advertising launch.
There was separate speculation earlier this month that Netflix could be looking to buy Roku outright, although that Insider report was sourced mostly to Roku employees, and treated with much skepticism from other analysts.
Roku’s CEO, Anthony Wood, addressed the rumors and didn’t entirely dismiss them, in a CNBC interview at the Cannes Lions festival, as reported by Media Play News.
“In terms of Netflix, obviously I can’t comment on rumors,” Wood said while adding that Roku’s advertising business “has been growing like gangbusters.”
After nearly a decade and a half of streaming, Netflix is pivoting to do something that it never had any intention of doing. Unlike Disney, NBCU, Warner Bros. Discovery, and other entertainment conglomerates who have launched — or will launch — ad-supported tiers on otherwise premium streaming services, Netflix does not have decades of broadcast and cable advertising experience, infrastructure, and relationships to draw from.
So, it is natural to think that the company would look for outside help to develop an advertising strategy and team. Whether the streaming giant partners with an established advertiser or buys one outright remains to be seen, but based on recent reporting, it appears clear that the company will not be going it alone.
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