Netflix Says It Will Stay Ad-Free Despite Missing Growth Targets

July 30, 2018 Los Gatos / CA / USA - Netflix logo in front of their headquarters situated in Silicon Valley; south San Francisco bay area
SHARE
THIS



Netflix has labelled reports it is pondering an ad-supported model as ‘false’ in a letter to shareholders.

But the denial comes amidst troubling times for the streaming giant, which lost 126,000 paid customers in the US and missed global growth targets during the last quarter.

“We, like HBO, are advertising free,” said Netflix CEO Reed Hasting.

“That remains a deep part of our brand proposition; when you read speculation that we are moving into selling advertising, be confident that this is false.

“We believe we will have a more valuable business in the long term by staying out of competing for ad revenue and instead entirely focusing on competing for viewer satisfaction.”

Netflix’s resistance to make the change comes after one analyst reported the company could stand to make an additional $US1 billion ($AU1.42bn) per year by introducing ads.

And the potential extra revenue could come in handy for the streaming service if the latest quarterly earnings are anything to go by.

Netflix expected to add 5 million subscribers in the second quarter of 2019 but didn’t even come close, adding only 2.7 million.

“We think Q2’s content slate drove less growth in paid net adds than we anticipated,” said Hasting.

Despite a relatively poor quarter, Hasting and his team remain bullish about the future, predicting it will add 7 million new subscribers in the next quarter thanks to the  new season of Stranger Things and original films from Martin Scorsese and Michael Bay.

This will be met with the loss of classic sitcoms Friends and The Office to competing streaming services.

But the growing competition in the streaming space, particularly the introduction of services from leading brands like Disney and Apple, doesn’t seem to concern Netflix.

“The competition for winning consumers’ relaxation time is fierce for all companies and great for consumers,” said hasting.

“The innovation of streaming services is also drawing consumers to shift more and more from linear television to streaming entertainment.”

Please login with linkedin to comment

ads Disney Netflix Revenue

Latest News

Kathmandu Launches An ‘Out There’ Sonic Logo
  • Campaigns

Kathmandu Launches An ‘Out There’ Sonic Logo

Outdoor lifestyle brand, Kathmandu, has teamed up with international music agency, MassiveMusic, to bring the brand sonically to life with the launch of a distinctive audio identity. What do you get when you combine the sound of you outdoors, a wooden melody and a unique bird call? The Sound of Kathmandu. Sound gives shape to […]

#OnlyOnTwitter: Top Moments In Australia 2021
  • Campaigns
  • Technology

#OnlyOnTwitter: Top Moments In Australia 2021

Twitter’s top moments in Australia revealed that this year, not unlike last, has been a unique one for us Down Under but our sense of humour and shared love of sport were a few things that helped us get through together. Twitter has been focused on serving the public conversation while connecting people with the […]

Method Announces Agency Development Partnership With Snapchat
  • Marketing

Method Announces Agency Development Partnership With Snapchat

Creative technology studio, Method has been selected as one of Snapchat’s first agency development partners across Australaisa. As one of a group of early Snap Development Partners selected across Australia and New Zealand, Method is able to provide clients with the opportunity to design and create Snapchat filters and games aimed to reach audiences across […]

Big Ads’ Rich Media Solution Now Integrated With The Trade Desk
  • Advertising
  • Campaigns

Big Ads’ Rich Media Solution Now Integrated With The Trade Desk

Big Ads and The Trade Desk have joined forces to enable traders to build rich media ads which are ready to serve at the touch of a button. Once built-in Big Ads’ creative & deal ID platform Buddy, the tags are deployed directly to The Trade Desk for the campaign to go live. Tech teams […]

Pinterest Expands Parental Leave Policies
  • Campaigns

Pinterest Expands Parental Leave Policies

Pinterest’s progressive parental policies are being expanded company wide. Beginning on January 1, 2022, employees in all global offices will have a minimum of 20 weeks of parental leave. This benefit extends to adoptive parents who will also have 20 weeks of paid leave which was previously 16 weeks. This is in addition to an […]

Acast Nabs Daisy Smith As New Regional Automation Director
  • Marketing

Acast Nabs Daisy Smith As New Regional Automation Director

Independent podcast company, Acast, has further grown its Australia and New Zealand team, hiring Daisy Smith as the region’s new automation director. Having jumped ship from Nielsen, Smith will now lead Acast’s local programmatic advertising offering, as the company continues to develop automated ad buying for agencies and direct clients. Smith boasts previous experience with […]

SCA Teams Up With Salesforce
  • Campaigns
  • Media

SCA Teams Up With Salesforce

SCA has teamed up with Salesforce. Although that's not to suggest Salesforce will be hosting the Triple M Grill Team.

Rethink Ink: A Fire Inside
  • Media
  • Partner Content

Rethink Ink: A Fire Inside

It's the latest in B&T's series of Re-Think Ink. That's the power of print and not anaphylaxis from ordering the squid.

Meltwater Appoints John Bissinella As Enterprise Solutions Manage
  • Campaigns
  • Media

Meltwater Appoints John Bissinella As Enterprise Solutions Manage

Meltwater has appointed seasoned media intelligence executive, John Bissinella as enterprise solutions manager for ANZ to help drive the continued expansion of its Enterprise solutions. He joins with a remit to consult Australia and New Zealand’s largest organisations on how to leverage the most comprehensive news, social and customer insights data available. Meltwater’s enterprise team […]

Sixt Teams Up With Bastion For A New Integrated Campaign
  • Campaigns

Sixt Teams Up With Bastion For A New Integrated Campaign

Global vehicle rental and mobility provider, Sixt, has teamed with Bastion Creative and Bastion Experience for a new integrated campaign. After launching into the Australian market, Sixt is now leveraging its “Above and Beyonding” brand positioning with eight separate film executions, several digital, print, and outdoor components, and specific creative to support its 163 retail […]