Netflix to Partner With Microsoft For Ad-Supported Streaming Plan

Netflix will team with software giant Microsoft to develop an ad-supported subscription plan, which Netflix will offer to consumers in the wake of widespread blowback after recent price hikes. The plan was announced back in April, but this is the most concrete information released yet suggesting their trajectory. In a press release, Netflix acknowledges that "it's very early days, and we have much to work through," but promises users that their pact with Microsoft will provide Netflix subscribers and advertisers alike with an experience that is "better-than-linear TV."

Outside of establishing corporate goals to bring consumers more choices and advertisers greater bang for their buck, it sounds like Netflix and Microsoft have not got many concrete ideas yet. Microsoft has access to a ton of advertiser data, gleaned through internet browsers, Skype, and various other products, as well as one of the most sought-after marketplaces in the streaming market.

"Today we are pleased to announce that we have selected Microsoft as our global advertising technology and sales partner," says Netflix in a statement. "Microsoft has the proven ability to support all our advertising needs as we work together to build a new ad-supported offering. More importantly, Microsoft offered the flexibility to innovate over time on both the technology and sales side, as well as strong privacy protections for our members."

"At launch, consumers will have more options to access Netflix's award-winning content," Microsoft said in a statement of their own. "Marketers looking to Microsoft for their advertising needs will have access to the Netflix audience and premium connected TV inventory. Today's announcement also endorses Microsoft's approach to privacy, which is built on protecting customers' information."

Microsoft has some experience working with cloud-based entertainment, since the Xbox servers do a lot of heavy lifting, even though owning consoles and downloading or purchasing games is still the norm on that side of the industry. Recently, Microsoft assured fans that while cloud gaming is convenient, there are no plans to phase out consoles anytime soon.

"Some people are always going to love playing on consoles, having a console in their living room to download and have that experience," Microsoft's senior global product manager at Xbox Game Pass Pav Bhardwaj recently said in an interview. "I love consoles--this is just another route, another option to open up gaming to other people. It's not that one is a detriment to the other, this is more of a rising tide, and it's a really good place to be in to offer all these different opportunities. There's still PC, and there'll be new form factors that come out in future."