Neflix Chooses Microsoft For Ad-support

Netflix are launching an ad-supported service and they have picked Microsoft as their partner. You might not have known this, but Microsoft made $10 billion in advertising sales last year, mostly through Xandr, an ad service business they bought from AT&T.

According to Bloomberg, Netflix wants to launch the service as soon as possible which is why they have outsourced the project to Microsoft. There could also be potential synergies with Microsoft's big gaming business; that's another expansion area for Netflix.

Netflix currently uses AWS for streaming content directly to you from the cloud. The algorithms that feed subscribers their shows will be entrenched at AWS so I imagine that relationship will stand strong. If they also used Amazon for advertising, they would probably become overly reliant on that service provider.

I see Netflix's advertising pivot as a positive, and of course, this is also good news for Microsoft.