Netflix's ad-supported tier has reached 40 million monthly users globally, as announced at its 2024 Upfront presentation. Initially viewed as a risky move, the paid ad offering has become a significant success, providing new revenue streams in the face of increasing streaming competition.
In just six months post-launch in late 2022, the number of ad-supported subscribers increased from 5 million to 40 million. In regions where the ad tier is available, over 40% of new Netflix sign-ups are choosing the cheaper ad-supported plan. The service now boasts 270 million total subscribers across all pricing tiers.
Netflix is enhancing its ad business by developing its ad tech in-house. It's launching its own advertising platform to ensure the same level of excellence as its streaming tech, according to Netflix’s president of advertising, Amy Reinhard. While initially partnering solely with Microsoft, Netflix is now also collaborating with Google, The Trade Desk, and Magnite for its ad sales and tech.
Netflix co-CEO Ted Sarandos stated that the ad membership has been an overwhelming success and they are just beginning their journey. The rapid scaling of Netflix's ad business showcases the strength of its brand and content, indicating a robust new revenue pipeline as it expands further into advertising.
