The key details:

• Ad-supported tier will cost $6.99 per month.
• It will be available in 12 countries, including Brazil, Japan, Mexico, the U.K. and the U.S.
• Netflix will run pre-roll and mid-roll ads that are 15 or 30 seconds long.
• Viewers will be shown four to five minutes of ads per hour, on average.
• Targeting options will be limited to country and content-based categories at launch.
• Starting sometime in 2023, advertisers will be able to use Nielsen’s Digital Ad Ratings to measure ads.

Programming and ad placement

While Netflix original programs such as “Emily in Paris,” “Glass Onion: A Knives Out Mystery” and “The Crown” will carry ads, not all TV shows and movies available to watch on Netflix will be available on the ad-supported tier. That’s because Netflix needs to renegotiate some of its deals with programming providers to insert ads into certain shows and movies.

Netflix COO and chief product officer Greg Peters estimated that 5% to 10% of the service’s programming library will not be available on the ad-supported tier, with the percentage varying by country.

A challenge for Netflix in inserting mid-roll ads is that some programs were not created to accommodate ad breaks, such as Netflix’s own shows and movies it has licensed. Rather than automate this in-stream video ad insertion as digital platforms like Facebook do, Netflix appears to taking a manual approach. The company’s internal content tagging teams have been enlisted “to find those natural breakpoints so that we can deliver the ad in the least obtrusive point,” Peters said.

Not all movies available on the ad-supported tier will carry mid-roll ads, though. New movies will only carry pre-roll ads, Peters said. Meanwhile, movies “that have been on the service for a while” will carry pre-roll and mid-roll ads, he added.

For advertisers, “pre-roll has more value. There’s going to be more engagement in that,” said Vicky Chang senior director of media at TV and streaming ad buying firm Tatari. However, Netflix has not told advertisers or agencies whether it will provide insights or guarantees regarding ads running as pre-rolls versus mid-rolls.

As for the frequency with which people will see ads, Netflix will air “no more than four to five minutes of ads per hour and including some tight frequency caps so members don’t see the same ad repeatedly,” Peters said. He didn’t say what exactly those frequency caps will be, and a Netflix spokesperson declined to provide detail. But multiple agency executives said Netflix has told them it will limit individuals from being shown the same ad no more than once per hour and three times per day. …read more

Source:: Digiday

Author: Aaron