Netflix’s switch to advertising could bring the streaming platform $US1.2 billion, according to a market analyst.
Michael Nathanson at analysts MoffettNathanson in the US has looked at the advertising market on streaming platforms in research titled, Mad Men to the Rescue?
Disney+ could generate $US1.8 billion and Netflix reaching $US1.2 billion by 2025.
However, this is only an estimate. The market doesn’t know enough about the pricing of ads on the streaming platforms.
Nathanson:“Netflix has the potential for much larger global ad growth.”
Netflix has reportedly brought forward plans for an advertising supported version of its global streaming media platform. An advertising supported version could be in the market by the end of this year.
Netflix’s backflip on advertising on its platform is being seen as a sign that the global streaming media platform market is more mature than previously thought.
Nathanson believes the move to advertising, if managed correctly, has the ability to strengthen the margins and growth trajectory:
“While we are excited by the opportunity that advertising creates at those two streaming giants, the devil will be in the details of how each company prices these new offerings and how much of the available content impressions will be available and suitable for advertising."
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