Netflix Taps Microsoft For Ad Support Plan

Netflix Inc. selected Microsoft Corp. as the technology and sales partner for its new advertising-supported streaming service, advancing its efforts to reignite subscriber and revenue growth, reports Bloomberg.

Netflix plans to sell a cheaper, advertising-supported alternative to its flagship streaming service by the fourth quarter of this year. People who already subscribe won’t see the ads -- those will be for customers signing up for the new tier.

Netflix long made the absence of ads a major part of its selling point to customers. But slowing growth has forced the company to look for new ways to attract subscribers, and new ways to generate revenue. The company announced plans to enter the advertising business after reporting a drop in customers.

Because Netflix has given itself a tight time frame to get the service up and running, management has searched for an outside partner to handle the sales and technology.

In a blog post Wednesday, Netflix disclosed few details about its plans. Chief Operating Officer Greg Peters has been meeting with potential candidates. Alphabet Inc.’s Google and Comcast Corp. had been seen as frontrunners.

“Microsoft has the proven ability to support all our advertising needs as we work together to build a new ad-supported offering,” Peters said in the blog post. “More importantly, Microsoft offered the flexibility to innovate over time on both the technology and sales side, as well as strong privacy protections for our members.”