Netflix is making moves to boost growth in its ad-supported business by lowering its ad prices, according to The Wall Street Journal. The streaming giant's ad-supported tier was launched at the end of last year, priced at $6.99 per month. Microsoft has been Netflix's exclusive technology and sales partner for this plan, but the company has recently been in discussions to sell ads through other partners as well.
To attract new advertisers, Netflix is also offering lower prices for ad deals. Recent agreements have been struck at $39 to $45 per 1,000 viewers, down from the previous $45 to $55 range. Although subscriptions to the ad-supported tier have nearly doubled since the first quarter, ad revenue is not yet a significant contributor to Netflix's financial results.
In addition to its new advertising model, Netflix is cracking down on password sharing to drive revenue growth. The company has discontinued its lowest ad-free plan, priced at $9.99 per month, for new customers in the U.S. and the U.K. Instead, new users can choose between the $6.99 per month ad-supported plan, a $15.49 standard plan, or a $19.99 premium plan.
Netflix's stock climbed 0.8% in premarket trading following these developments. The company has not yet responded to requests for comment as of Thursday morning.
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