Although Netflix announced to the world in July that it will release its ad-supported version in early 2023, the streamer might be changing its plans. As The Wall Street Journal reported on Wednesday, Netflix executives told ad buyers that the release date would now be November 1, 2022. If this ends up being the case, Netflix could release its lowest-priced ad tier. a month before its competitor. Disney+.
Netflix and Disney+ have been racing to launch a cheaper ad-supported plan as the two streaming giants look for ways to turn a profit and attract more money-conscious subscribers. Sources told Variety that Netflix plans to release in multiple countries, including the United States, United Kingdom, Canada, France, and Germany. Disney+ will initially launch in the US in 2022 before expanding to international markets the following year.
“We are still in the early days of deciding how to launch a lower priced ad-supported tier, and no decisions have been made. So this is all just speculation at this point,” a Netflix spokesperson told us.
Sources revealed to The WSJ that the streaming service plans to charge advertisers roughly $65 per 1,000 views. Netflix only allows brands to spend $20 million per year to ensure subscribers don’t see the same ad too often, the sources added.
The high CPM price (cost per thousand) points to the company’s high expectations for the platform with inbound advertising and that it is confident that buyers will have strong enough interest to shell out the cash. Ad buyers mentioned that it is typical for newcomers to the ad space to look for high prices and then settle for lower prices.
By comparison, Disney+ commands roughly $50 to $60 CPM, the Journal previously reported.
Looking at ad load, buyers claim that Netflix’s ad-supported tier will have an ad load of about four minutes per hour for TV shows. For movies, the streaming giant will run pre-roll ads, Variety wrote.
Bloomberg reported earlier this month that children’s programming on Netflix would remain commercial-free. There has been speculation that the original films would initially remain ad-free as well.
This is similar to the Disney+ plan, which confirmed to TechCrunch in May that it would have a light ad load at an average of four minutes of ads per hour. Preschool programming will be commercial-free on the family transmitter.
While we don’t know how much Netflix’s ad level will be, the rumored cost is somewhere between $7-$9 per month. Rival Disney confirmed in its recent earnings call that its flagship streaming service, Disney+, would charge subscribers $7.99 per month.
Recent reports have also stated that Netflix will not allow offline viewing on its ad plan. Many of Netflix’s plans are unconfirmed, so anything could change as the company rolls out the ad-supported plan.
However, the 25-year-old streaming service has made a few confirmed moves, including partnering with Microsoft to help launch the ad tier. Netflix also confirmed during its July earnings call that the ad-supported plan won’t have its entire catalog of content when it first launches due to licensing deals, so advertisers won’t be able to buy ads for certain titles, at least initially. .
The company also recently hired two executives from Snap Inc., Jeremi Gorman and Peter Naylor, to run its advertising business.