The early performance of Netflix’s ad business

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The Future. While Netflix has more subscribers than any other streaming service, it’s among those with the fewest subscribers paying for an ad-backed version of its service. The streamer’s ad tier could get a boost, however, after it cracks down on password-sharing in the US and more countries around the world.

Subscribers by the numbers
Netflix is competing for major ad dollars with streamers that have been in the ad business longer and boast more ad-watching subscribers.

  • Its $6.99/month ad tier reportedly had 937,616 US subscribers in March 2023, whereas Disney+’s (which launched a few weeks later) had 863,791.
  • Hulu had 20 million ad-tier subscribers, Peacock had 15.5 million, Paramount+ had 10.7 million, and HBO Max had 3.6 million in the US in March.

Advertisers’ thoughts
Some ad buyers point out that the Netflix ad tier’s small subscriber base doesn’t allow them to run as many ads as they want or effectively target certain subscribers.

  • Others have held back from buying a lot of inventory because Netflix’s ad prices are more expensive. 
  • Still, others praise the Netflix ad tier for letting them reach a subset of the population they had been closed off from for years.

The bottom line
Once Netflix cracked down on password-sharing in Canada and Spain this past February, the company said people subscribed to the service for the first time on the lower-cost ad plan.


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