Ted Sarandos Explains the Controversial Design to Pursue a Subscription Tier That Includes Ads

There has been a lot going on at Netflix, from layoffs to a market meltdown, and more is on the way: a lower-priced, ad-supported subscription option, which Netflix's Co-CEO, Ted Sarandos, detailed in a recent interview with New York Times columnist Maureen Dowd. "For us, it was all about simplicity of one product, one price point," Sarandos told Dowd. However, "I think it can now withstand some complexity," he added to the outlet.

For years, Netflix had fought an advertising strategy by focusing on subscribers. Dowd questioned Sarandos if he thought the company's recent lack of various revenue sources had harmed it. He said, "I think it's the trade-off of simplicity and complexity and to do what we did in the last 10 years, I think we benefited much more from simplicity."

The road to an advertising business for Netflix could be rocky. The company has not licensed its shows for streaming or advertising, and in order to attract advertisers, Steve Shannon, CEO of Swerve TV and a former Roku executive, stated in March. Hastings was upbeat about the ad tier during the results call that drove Netflix's shares plunging in April.