Netflix and Microsoft collaborate on a less expensive plan with advertisements

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To provide users with a less expensive subscription option that includes advertisements, Netflix has partnered with Microsoft.

The industry leader in streaming claims that the service will be an “addition” to its current subscriptions, which are free of advertisements.

How much the business intends to charge customers for the new service is still a secret.

After reporting its first subscriber decline in more than ten years and making hundreds of job cuts earlier this year, Netflix made the announcement.

Between January and March, it lost 200,000 users, as opposed to the 2.5 million analysts had predicted the company would gain during that time. Additionally, Netflix now anticipates losing an additional two million subscribers between April and June.

The company announced that it had chosen Microsoft as its exclusive global sales and advertising technology partner to launch a “lower priced ad-supported membership plan.”

According to the Wall Street Journal, Netflix is attempting to restructure its contracts with major entertainment companies to include advertisements in its service.

According to reports, the company has talked with Sony Pictures Television, Universal, and Warner Bros.

Netflix’s market value was reduced by $50 billion in April after the firm revealed an unexpected decline in subscribers, the first since October 2011.

The business reported losing 700,000 users as a result of shutting down its service in Russia, despite having gained millions of subscribers during the COVID lockdowns. It also cited consumers who shared their Netflix passwords with others as a cause of the rivalry.

The business announced 300 job losses last month as it struggled with the decline in consumer volume.

Also in the past month, Netflix’s co-CEO Ted Sarandos stated that the company was in discussions with several businesses to identify ways to appeal to price-conscious customers.

“Netflix won’t receive any more adverts in its current form. We are creating an ad tier for folks who say, “Hey, I want a lesser price and I’ll watch advertising.” Mr Sarandos stated while addressing an audience at a convention in Cannes.

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