Is the New Netflix-Microsoft Partnership a Massive Mistake?
Microsoft (NASDAQ: MSFT) has signed a deal with Netflix (NASDAQ: NFLX) to provide the technology and sales expertise that will underpin the streamer's upcoming ad-supported tier. For Netflix, working with one of the biggest tech firms in the world on one of its most important projects in recent years is somewhat of a boon. And for Microsoft, overseeing the nascent ad product for the most popular streaming service on the planet only serves to boost its suite of marketing services.
Still, for both companies, the risks of failure can't be overstated. Netflix has positioned a lower-cost ad-supported offering as a strategy to combat falling subscriber numbers. Meanwhile, Microsoft no longer operates a streaming platform upon which to sell video ads (R.I.P. Mixer). Fundamentally, this is an enormous opportunity for the two companies, but there's a chance they both might have bitten off more than they can chew.
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Source Fool.com
