Netflix is reportedly set to experiment with new advertising formats and build its own technology to support them. The company is looking to stay ahead of rivals such as
Amazon.com
after making the leap to ad-supported streaming.
Netflix
(ticker: NFLX) management has talked about plans to more directly target adverts at viewers, the Financial Times reported on Monday, citing discussions with advertising executives. The FT reported one advertising executive also said Netflix’s deal to use
Microsoft
(MSFT) technology for serving adverts is likely to end next year, leaving the company free to build its own platform.
Netflix said the report was based on speculation, and declined to comment further when contacted by Barron’s.
However, it would come as little surprise if Netflix looks to move ahead quickly with new formats to keep advertisers on board, as it prepares for likely competition in ad-supported streaming from Amazon’s (AMZN) Prime Video.
While Netflix said earlier this year that its ad-supported tier had nearly five million users, it hasn’t broken out the exact number of subscribers. The Wall Street Journal reported that some ad buyers were frustrated by its relatively small ad-tier subscriber base, which was estimated at less than one million in the U.S. as of March by subscription-analytics firm Antenna.
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