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Company “Open” to FAST Offering – The Hollywood Reporter

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Is a free, ad-supported streaming service in Netflix’s future? The company’s top executives seem quite open to the idea.

Asked on the company’s Q4 earnings call whether Netflix would pursue a so-called “FAST” service, newly minted co-CEO Greg Peters smiled and passed the question onto his colleague Ted Sarandos.

“We’re open to all these different models that are out there right now,” Sarandos said, adding that “we’re keeping an eye on that segment, for sure.”

However, don’t get your hopes up for any imminent free Netflix option. Sarandos noted that “we’ve got a lot on our plate this year, both with the paid sharing” — i.e., the password sharing crackdown — “and with our launch of advertising.”

In other words, they plan to deal with those things before leaning into FAST.

With regard to its current advertising tier, the executives were light on specifics (the service only got into the business two months ago).

Peters said that in a promising sign, subscribers to the ad tier are engaging with content at a similar level to that of standard tier users.

“That’s really a promising indication. It means we’re delivering a solid experience and it’s better than we modeled and that’s, you know, a great sort of fundamental starting point for us to work with,” Peters said, adding that they have a “long list” of improvements and changes they hope to make to its ad business over time.

Peters, at the prodding of Hastings, said that Hulu’s success with advertising served as a guide for them, and that Netflix’s 230 million subscribers and global scale (and with Hulu U.S.-only), the company thinks it will be able to overtake Hulu in the ad space.

“I just want to emphasize it’s a multiyear path,” Peters said. “So we’re not going to be larger than Hulu in year one, but hopefully over the next several years we can be at least as large, and we wouldn’t be getting into this business if it couldn’t be a meaningful portion of our business.”



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