Netflix is changing the terms of its advertising deal with tech giant Microsoft Corporation and cutting the prices of ads.
Under a deal made last year, Microsoft gives the streaming group the technology it needs to put ads on the site. This service is a key part of Netflix’s $6.99 (₱380) ad-supported subscription plan, which it started offering in 2022 to help grow its user base and compete with other streaming services.
Microsoft agreed to pay a so-called minimum guarantee, or a promise that it would send Netflix a lot of money from ads. This was part of the deal. Wall Street Journal says that this would help cover some of Netflix’s financial risk.
READ: Netflix Ban on Password Sharing Drives Sign-Ups
People who know about the situation said that Netflix is now working with Microsoft to lower the income guarantee. It also said that some officials at Netflix are upset that Microsoft hasn’t been able to sell more ads. Wall Street Journal said that the company is also having early talks about selling ads through other partners.
Some people who buy ads have recently decided to pay Netflix between $39 (₱2,000) and $45 (₱2,500) for every 1,000 viewers. Reports in the news from the past said that the fee was between $45(₱2,500) and $55 (₱3,000).
ALSO: Netflix Won’t Allow Password Sharing This 2023
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