Due to licencing and privacy law challenges, Netflix’s upcoming ad-supported subscription might not feature ads for all content — at least for now.
The streaming service told its partners that it wouldn’t include ads in kids’ programmes or original movies when they are first released.
It might, however, include commercials in original movies at a later stage.
Netflix has the rights to include ads in its original shows and movies.
However, a large portion of its catalogue is licenced content, and Bloomberg notes that many of the licence deals don’t include rights to screen programmes in an ad-supported format.
Insiders close to the matter told Bloomberg that Netflix is currently in talks with studios such as the Sony Group Corp., Paramount Global, and Warner Bros. Discovery Inc. to secure the rights to show ads in their programming.
While some partners don’t allow ads within some of their content, Netflix can still show commercials before and after.
Ad screening during kids’ programming presents other challenges. In 2019, Google and YouTube had to pay $170 million (R2.9 billion) for violating kids’ privacy laws.
The streaming service will initially air kids’ shows without commercials, but Bloomberg reported it could decide to introduce ads in future.