The leader of the streaming service returned to the subject in a recent interview.
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The streaming war is still in full swing and consumers are more than ever spoiled for choice. Most of the competitors have certainly opted for a paid subscription model which seems the most effective. But others are opting for funding models that are partly advertising-driven. This is the case with NBC's Peacock, which US users can use for free in exchange for watching ads. Rumors now claim that HBO Max is working on a lower-priced offer that includes advertising.
No advertising but product placements
So it's quite naturally that Reed Hastings, the co-founder and CEO of Netflix, was asked about this by Variety. And as he has always said, he felt that the streaming service has no interest in adopting the advertising model:
It is not a rule, but rather an analysis that we do. We believe we can build a better business, a more profitable business [without advertising]. You know, advertising seems easy to embrace until you actually put it into it. Then you realize that you have to squeeze that income out of other places because the ad market is not growing, and in fact, is shrinking right now.
The boss of the streaming service therefore does not intend to give up the subscription model which has been very successful in his business.
As a reminder, Netflix accepts product placements in some of its content. Stranger Things fans, for example, have already had the opportunity to see the characters of the series eat chicken at KFC. The Forrester Research Institute estimated in a study published in 2019 that the sums spent by marketing departments on programs should double in 2020. An assertion denied by the company, which however recognizes the practice. The streaming service has even recently strengthened its teams specializing in partnerships.
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