New Delhi: Streaming giant Netflix, which has laid off 450 employees in two phases so far, is set to launch an ad-supported tier by the end of the year to reduce its losses and bring more users to the platform. Netflix co-CEO Ted Sarandos confirmed during the Cannes Lions advertising ceremony that the streaming giant’s future will include commercials, reports The Hollywood Reporter. “We’re adding an ad tier. We’re not adding ads to Netflix as you know it today. We’re adding an ad tier for people who say, ‘Hey, I want a lower price and I’ll watch the ad’ ,'” Sarandos told ‘Sway’ podcast host Kara Swisher.
Sarandos confirmed that the streaming service is in talks with potential ad-sales partners. (Also Read: After Haircare Line Brand Anomaly, Priyanka Chopra Launches Houseware Brand Sona Home)
As the company’s stock price has plummeted, speculation has intensified that Netflix may be acquired soon. (Also read: Markets rally for second day; Sensex, Nifty rise 1% amid strong global trends)
Sarandos acknowledged that a buyout is “always a reality, so we have to take a comprehensive look at it”.
However, he stressed that “we have a lot of scale and profitability and free cash flow to continue this business”.
Rival Disney Plus also plans to launch a similar ad-based offering by the end of the year before going global, starting with the US.
Its stock fell 20 percent after Netflix reported a loss of 2 million paid subscribers in the first quarter of 2022, its first subscriber loss in a decade.
In addition, it now forecasts a loss of 20 lakh global paid customers for the April-June quarter (Q2).
After laying off 150 employees recently, the popular video streaming platform has once again shown its way to an additional 300 employees in the second round of layoffs.
Several business operations have been cut at the company, with a large number of jobs lost in the US.
The forum has indicated that more rounds of layoffs are on the way this year.