Netflix’s biggest hope for its imminent ad tier is increasing revenue not from ads themselves, but by attracting new sign-ups with a cheaper subscription option.
Netflix lost 970,000 subscribers in Q2 this year. Not great, but it’s better than the two million subscriber loss it was expecting.
To be fair, Netflix still saw 9% revenue growth for the quarter from new sign-ups. But Netflix expects churn to outweigh new growth – unless it can use advertising as a tourniquet to stop the bleeding.
