Netflix’s cloud computing cost cut could open the door for Microsoft

As Netflix looks to improve its financial situation amid slowing subscriber growth and a $200 billion loss in market value since November, cloud computing cost-cutting measures could complicate the relationship between the leading streamer of the market, its partner Amazon Web Services and its new partner Microsoft.

Netflix, which has lost more than 1 million subscribers in 2022, is seeking to “better control cloud computing costs” with its partner Amazon Web Services, according to The Wall Street Journal. The company is said to be keeping a close eye on costs, and in particular looking to cut increases as it aims to grow its subscriber base to 500 million global customers in the next three years. This includes reducing the number of data copies you have around the world.

This is particularly noteworthy because Netflix’s unexpected partnership with Microsoft to launch its ad-supported tier later this year could offer an alternative to AWS in the future. Microsoft owns cloud storage company Azure, and while a person with knowledge of the situation told TheWrap that “nothing has changed in that partnership or in the overall approach to managing infrastructure” when it was announced by first time partnering with Microsoft, little in the media industry has ever been left. in stone

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Netflix’s recent emphasis on fiscal responsibility and its reported desire to reduce cloud computing expenses are very likely not aligned with AWS’s goals as a company. If Netflix gets an opportunity to cut costs and remove an asset from a rival company while approaching a new partner, many in the media industry believe they will seize it. Multiple media analysts told TheWrap at the time of the Netflix-Microsoft announcement that the ad may simply be the first step in a larger migration for the streaming giant.

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Netflix is ​​also said to be considering cutting costs on hiring by bringing in more younger employees, reining in spending when it comes to merchandise benefits, closing multiple office spaces and being more economical with its content investments. The company has already laid off more than 400 employees this year.

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Netflix to launch ad-supported pricing tier in November ahead of December Disney+ launch

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