What you need to know:

• Four minutes of ads per hour.
• No repeat ads, Netflix also running rule on ad quality.
• Mid rolls on series only, 15 and 30 second pre- and post rolls on everything else.
• US launch as early as 1 November, 12 markets including Australia to follow.
• Opens to advertisers and subscribers simultaneously, i.e. no pre-built audience.

Netflix is briefing media buyers on its Australian ad launch plans, with advertisers preparing for a local launch before Christmas – with Australia set to quickly follow a US launch slated for November.

The world’s largest streaming platform will sell audiences to advertisers via Microsoft’s ad team and newly acquired Xandr.

Agencies have been told to expect:

• Four minutes of ads per hour.
• Prices based on US CPMs of $65, which equates to $95.
• Mid rolls on series only (which will capture people who binge series).
• Pre and post rolls on every other programme (15 and 30 seconds).
• Strict frequency caps: three ads per brand to a user each day.
• US launch as early as 1 November with 12 markets, including Australia, Japan, Korea and broader APAC markets launching simultaneously, or quickly following.

Some media execs have questioned whether Netflix has the sales infrastructure in place and suggested the local launch could blow out until January. While that would enable the platform to launch and market an ad-funded tier, it would mean missing huge Christmas demand.

As one Microsoft exec recently told Mi3, “if I were a betting man, I’d prepare for an Australian launch this year.”

Agencies briefed by the platform last week were told the ad-funded tier will launch the same day for consumers as it is for advertisers – i.e., with no pre-built audience. The execs said the streaming service is setting strict quality controls, initially at least, about which ads it would allow.

“There will be lots of restrictions on types of advertising. You can imagine what type they look for – they don’t want ‘Down, Down’ and ‘chickens are five dollars’. They want brand ads, storytelling ads,” said one.

With four minutes of ads per hour, pre-roll – before the content, and mid-roll – during the content, there will be a cap of three ads per brand to a user each day, and each of those ads would need to be different, added the exec. That means one creative per brand, per user, per day.

“Early advertisers are going to have to suck it and see,” per the buyer. “[The Netflix ad team] said  ‘We don’t know [how big the audience will be]. We expect it to build’.”

One holdco exec said their questions for Netflix were around the audience and targeting. The representatives, from Microsoft and Xandr, are understood to have spoken about how advertising could be integrated into content genres.

“They have more control over that than a broadcaster would,” one person said. Another holdco exec predicted the launch would go down well with larger clients.

“It’s just one of those things you know is going to go well. There will be advertisers – bigger budget brands – who will want to be a part of it. It’s cool. This could change the game for advertising quality.”

Per a Netflix spokesperson: "We are still in the early days of deciding ho to launch a lower priced, ad-supported option and no decisions have been made. So this is all just speculation at this point."