Netflix CFO leaves door open to ad-supported subscription tier
Netflix chief financial officer Spencer Neumann has cast doubt on the streaming service’s longstanding opposition to advertising as a potential revenue stream, declaring ”never say never”.
Netflix CFO leaves the door open to ad-supported subscription tier
Any move toward a budget subscription tier subsidized by adverts would mark a fundamental shift in policy for the market-leading streaming provider, which has thus far stuck hard and fast to its ad-free model.
Amid increasing pressure from investors for the service to do more to boost revenue, that dam could be about to break – although Neumann insists there are currently no plans to go down this road ”right now”.
Addressing the Morgan Stanley Technology, Media & Telecom Conference, Neumann said: ”It’s not like we have religion against advertising.” But, he warned, any relaxation of its anti-advertising stance would be a long way off.
”It’s hard for us to ignore that others are doing it, but for now it doesn’t make sense for us.”
Neumann reiterated Netflix’s rationale for foregoing ad revenue, pointing out that a core selling point of the business is its offer of ad-free movies and TV shows funded solely by subscription income.
Netflix is taking heat over a plateauing in new subscribers, which contributed to a 43% collapse in its share value this year. It faces intense competition from a glut of streaming providers – not least Disney+, which recently announced an ad-supported streaming tier for cost-conscious viewers willing to put up with ad breaks.
Instead, Netflix is pursuing its offer of mobile games to subscribers as it seeks to diversify its business over the coming decade.
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