Image for article titled Netflix Buddies Up With Microsoft to Craft Its Upcoming Ad-Based Subscription Tier

Were you not sold on the idea of a cheaper ad supported tier for subscribers? It would make you feel better if you knew that Microsoft was going to be in charge of the streaming business.

Both companies confirmed that they will work together to support the ads. Nobody has any idea what that will look like. Greg Peters wrote that Microsoft offered the flexibility to innovate over time on both the technology and sales side.

Peters wrote that they are hoping to have a better experience for advertisers. It speaks to the personalized nature of streaming companies.

There are other streaming platforms that have ad-supported subscription tiers, so it makes sense for them to do the same for them. According to recent news out of the Cannes Lions marketing festival, there were several companies that were interested in being the flame to their candles. The latter two companies are still competitors to the popular streaming service, even though they are owned by the same company. Ted Sarandos told industry people at the festival that they didn't want to own their own advertising brand unless it was so important that they brought it in-house.

It's a great deal for Microsoft. Marketers looking to Microsoft for their advertising needs will have access to theNetflix audience, according to a letter written by Microsoft's President of web experiences.

Microsoft isn't the first company that comes to mind when you think of advertising, but it's still a powerhouse. Hundreds of millions of people use Microsoft Store, Bing, and other services. The acquisition of Xandr was finalized last month.

The company never wanted to be in this area. Reed Hastings said that the service would try to stay ad-free. The company's first quarter results at the beginning of this year showed it had lost subscribers for the first time in company history Wednesday's news gave the price a small boost, as its stock value has remained far lower than its peak. Password sharing is a major pain for the company, but some analysts disagree. The company said it would try to restrict users from lending their accounts. The reported tests to curb password sharing have not gone swimmingly.

Since the company announced it was adding ads to the platform, users have wondered if this would change anything for how they consume content. We don't know if current users will see prices go up or down once the new tier drops, but the company said it will keep subscription plans for those who don't want ads. The basic plan, standard plan, and premium plan prices went up at the beginning of the year.

The new ad-supported tier is still in the early days and there is no comment on whether it will affect pricing overall.