Did Netflix Get Soft?
How will this impact Ad-tech for OTT in general? What does Microsoft´s foray into the globally lucrative video advertising market? And how would this impact Google´s strong foothold in the business of TV?
All official announcements from Netflix are rightfully consumer-focused. Fair play to the first global OTT provider who tried long enough to have an ad-free stance for binge-watching quality content. With content being the central focus, and arguably with good price points across the world, it could only last that long. The sustenance of such a business model makes the pre-summer announcement not surprising. One can only imagine the amount of work spent ahead of this time in deciding the choice to use the Xandr /Microsoft as well as other trials which surely have taken place.
It is incredible how swiftly the launch plans were announced across all continents last week to offer the ad-based tire across every continent in November. It seems to be as rapid as it became globally available in the first place. But the question is if the 30% price cut is good enough, where consumers will need to watch 4 minutes of advertising, every hour, for now. It is of course a great call to not impact existing customer choices, while Standard and Premium subscribers will not have this option as yet.
Netflix is certainly bold enough to insert 30-second adverts where 4–6 such ads or many shorter ones will be inserted every hour as pre-roll and mid-roll ads. Netflix has referred to this as “light” which means it would increase — and if the consumers don’t complain too much? While they have showcased only how one single 15-second advert feels, we should expect to get used to more right away.
Is it really a downgrade to choose the ad-tier subscription? This will depend if the 4 mins of advertising remain so or not. I don’t think the reduced content offered in this tier is the problem as much as the price point, which still seems high for a consumer with all the other options available today. Especially when many already complain of reduced content as Disney and other content providers have taken off their shows over the past many months.
Netflix has already prepped itself with content tagging teams to choose the right points where the mid-roll adverts will be inserted. This is extremely important for the user who would already be on the edge, literally speaking.
How would this work for the measurement and viewing of ads within downloaded content — is understandably a plan for 2023. Netflix is working with DoubleVerify, IAS, and Nielsen for making sure view-ability is confirmed as well as audience reach is tracked.
Netflix has taken a hard stance that the Price & Plan is a much-needed stance for all Parties and time will tell if they need to soften it a bit more or not.
With my professional foundations set at NewsCorp´s Ad-sales teams, of course, a lifetime ago, I find it most natural for Netflix to finally include adverts back into TV, where they belong!
