As advertisers await the launch of the streaming giant’s highly anticipated ads-supported tier this week, Netflix is boasting some strong numbers in its quarterly earnings report this month.
The platform was expected to add one million subscribers in Q3. Instead, the company gained 2.41 million new subscriptions – more than doubling expectations for new customers in the July–September time frame. In addition to this, Wall Street forecasts predicted $7.85 billion revenue for the quarter – Netflix also surpassed this with $7.93 billion in reported earnings.
This all happens amid the impending Basic with Ads plan, a new ad-based streaming option that will be available to U.S. subscribers beginning November 3. Since our last update, there has also been a new development on this front: Netflix has teamed up with data partners DoubleVerify and Integral Ad Science, a move intended to provide advertisers with more confidence and transparency into the platform’s audience measurement.
Meanwhile, there is new reporting that Apple is making its own moves towards the ad-supported video space, as the company is considering a new ad-based subscription tier for its streaming service, Apple TV+. After similar brands including HBO, Disney, and now Netflix have done the same, the play is hardly surprising.
However, a change like this may force the streamer to alter its subscription model. A cheaper ads-based plan makes sense for Netflix, where the current ad-free standard tier is $15.49 a month. But for Apple, where a subscription cost is currently just $4.99, the brand may be forced to hike its ad-free option higher, or just offer the new ad-based plan for free.
While these developments are optimistic for the ad-supported video space in general, we at Brkthru prefer to wait and let these platforms prove their value before jumping in head-first. Access to Netflix inventory may be exciting for advertisers, but the offering still bears some major caveats, such as high CPMs and a staggering minimum investment level, to name a few.
For now, we’re still confident in our current video partners, which we know can offer performance on quality inventory, and for more affordable prices.
Things hardly stay the same in the programmatic space, and things are moving especially rapidly these days when it comes to CTV, but at Brkthru we’re on it 24/7 to ensure we are always offering you the most up-to-date solutions in digital marketing. Contact us today to see how we can keep you informed on the latest changes in everything video.