Although Netflix said in July that its ad-supported version would be available in early 2023, the streamer’s intentions may have changed. According to The Wall Street Journal, Netflix executives told ad purchasers on Wednesday that the launch date will now be November 1, 2022. If this is the case, Netflix may launch its lower-cost ad tier a month before its competitor, Disney+.
Netflix and Disney+ have been racing to launch a lower-cost ad-supported plan as the two streaming behemoths seek methods to turn a profit while appealing to more cost-conscious users. According to Variety, Netflix intends to launch in a number of countries, including the United States, the United Kingdom, Canada, France, and Germany. Disney+ will first be available in the United States in 2022, before spreading to overseas markets the following year.
According to The Wall Street Journal, the streaming service intends to charge advertising around $65 per 1,000 views. According to reports, Netflix is only allowing advertisers to spend $20 million each year to ensure that users do not see the same ad too repeatedly.
The high CPM (cost per thousand) price reflects the company’s high expectations for the upcoming ad-supported platform and its confidence that purchasers will be interested enough to pay the price. Ad buyers stated that it is common for beginners to the advertising industry to demand high pricing and then settle for lower prices later on.
In comparison, the Journal previously reported that Disney+ charges between $50 and $60 CPM.
Buyers claim that Netflix’s ad-supported tier will have an ad load of roughly four minutes per hour for TV episodes. According to Variety, the streaming giant will air pre-roll commercials for movies.
Bloomberg reported earlier this month that Netflix’s kids’ programming would stay commercial-free. It has been speculated that original movies will also initially be ad-free.
This is comparable to Disney+’s goal, which was verified to TechCrunch in May that it would have a light ad load of four minutes per hour on average. On the family-friendly streamer, there will be no advertising throughout preschool programmes.
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While we don’t know how much Netflix’s ad tier will cost, it’s reported to be between $7 and $9 per month. In a recent earnings call, rival Disney stated that its flagship streaming service, Disney+, would charge customers $7.99 per month.
According to recent reports, Netflix’s marketing plan will not allow for offline viewing. Many of Netflix’s ideas have yet to be verified, so anything could change as the company develops the ad-supported service.
However, the 25-year-old streaming service has made a few verified moves, including a collaboration with Microsoft to help launch the ad tier. During its July earnings call, Netflix also stated that the ad-supported plan would not have its entire content catalogue when it first starts due to licencing agreements, so marketers won’t be able to buy advertisements for specific movies – at least not immediately.
Jeremi Gorman and Peter Naylor, two Snap Inc. executives, were recently appointed to oversee the company’s advertising operations.