One of the most popular streaming platforms, Netflix, has teamed up with tech giant Microsoft to offer its customers an ad-supported subscription plan. The adverts will be low-priced and an extension to the existing subscription process. Netflix and Microsoft are teaming up to boost the rate of subscribers, which has decreased over the past decade. Multiple factors, including the competition in the streaming world, have encouraged the streaming platform to collaborate with the tech giant. The question is how Microsoft will assist its new partner in boosting the viewership and rate of subscribers.
Why are Netflix and Microsoft Teaming Up?
Netflix and Microsoft are associated only to assist the streaming site. Apparently, the platform has witnessed a great deal of loss in subscriptions. Due to the alarming situation, hundreds of Netflix employees also lost their jobs earlier this year. According to the streaming giant, the newly introduced service will be an additional plan to revive active users. However, neither Microsoft nor Netflix has revealed the set charges for the users. The tech giant will work on the commercials within the app for the subscribers availing of the service.
Netflix’s Current Situation
According to Greg Peters, the chief operating officer of Netflix, the company has to work hard, and It’s only the beginning. The long-term plan is to satisfy the customers with both ad-based and premium services. Peters also stated that the streaming giant never wanted commercials as the entire model was built around the subscriptions on monthly basis. However, the platform executives had to alter their rules and make Netflix and Microsoft work together to control the constantly losing figures of subscribers. Netflix lost 200,000 subscribers previously between January and March. Also, the streaming giant Netflix is expected to yield a further 2 million subscribers in the coming months.
Is Netflix Copying Spotify?
Many factors have pushed Netflix towards adapting advert-based tactics to attract new audiences. The rising competition involving other streaming platforms like HBO max, Disney, and Amazon Prime has become one of the issues for Netflix. According to reports, Netflix and Microsoft are associating to introduce a coping mechanism similar to Spotify, which offers free music services and ads popping up. Apparently, the goal is to offer cheaper services with the addition of commercials to generate revenue in multiple ways.