Netflix partners with Microsoft for upcoming ad-supported subscription tier

The streaming giant recently announced it was exploring cheaper plans.

Lucy Nicholson / Reuters

Netflix has found a partner for its upcoming ad-supported tier. On Wednesday, the company announced it plans to work with Microsoft on the effort. In a blog post published by Microsoft, the tech giant said it would provide Netflix with technological and sales expertise.

As recently as last month, The Wall Street Journal suggested Google and Comcast were among the leading candidates to help Netflix build out an ad-supported tier. On Wednesday, Netflix said it selected Microsoft for the tech giant's "proven ability" to support its customers. "Microsoft offered the flexibility to innovate over time on both the technology and sales side, as well as strong privacy protections for our members," said Netflix Chief Operating Officer Greg Peters. Not mentioned is the fact that Microsoft doesn't operate a competing streaming service.

Netflix co-CEO Reed Hasting first revealed the company was exploring cheaper plans this past April. The admission came after Netflix announced that it had lost 200,000 subscribers in the first quarter of 2022. At the time, Hastings said the company planned to finalize the details of its plans "over the next year or two." Netflix is scheduled to announce its second-quarter earnings on Tuesday. According to CNBC, the company recently warned Wall Street it may have lost as many as two million subscribers over the past three months.

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